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Amazon insurance requirements get even stricter. [update]

Amazon is taking more steps in tightening their requirements of product liability for third-party sellers. This time around, the orange giant made further revisions to its existing commercial liability insurance policy requirements. The announcement came on June 20th, 2022 and became effective merely seven days later, on June 27, 2022. 


As most sellers are now confused as to what these changes mean, here’s the break-down on two major changes:


Change #1

Up until recently, Amazon required third-party sellers to acquire commercial liability insurance policies with deductibles up to $10,000. 

The update: now, sellers whose gross sales are up to $1M or less may not have any deductibles.

This revision is a sharp turn from Amazon. Here’s why: Deductibles are very common in liability policies. They are a way for sellers to significantly decrease the cost of their policy since they will only be covered by their insurer for damages above a certain amount. But a non-deductible insurance plan comes with a higher premium. So this change will most likely mean that third-party sellers will have to acquire insurance policies at much greater costs.



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Change #2

Up until now, Amazon required only the names of your legal entity on the insurance policies. 

The update and this is actually good news: Amazon officially approved using your DBA name (Doing Business As) in the policy. Meaning you don’t have to use your legal entity in the policy if you are known by another title. 

Only a year earlier, Amazon made insurance mandatory for third-party sellers who meet certain criteria. By now, most sellers have acquired commercial liability policies as required. But now it seems Amazon has tightened the rules, only weeks prior to Amazon Prime Day (July 12 and July 13.) Take it from us, and top-200 Amazon seller Jason Boyce: being insured as a third-party seller is vital. Even if these new changes end up hiking up your premium, not only is it mandatory for you to be insured as an Amazon seller, it is important to know that these policies can save your store. Any third-party seller can be sued by a client and having your Amazon liability insurance in place keeps your risks at bay – so you can focus on your business growth.  Click here to get the fastest, affordable and hassle-free insurance policy.

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