As an Amazon seller, your business faces unique challenges, and one of the most important areas to understand is product liability. Ensuring your products are safe and compliant not only protects your customers but also safeguards your business from potentially costly lawsuits. If you’re selling in the USA, it’s critical to understand the regulatory landscape and how Amazon-compliant liability insurance can help mitigate risks and provide peace of mind.

Are you a Malaysian or Singapore company selling on Amazon US? Together with our insurance partner, we offer a liability insurance solution built specifically for Malaysian and Singapore-registered companies to meet Amazon’s US insurance requirements.

Amazon is now stepping up its enforcement of liability insurance requirements:

Amazon US Insurance Requirements at a Glance

Amazon US seller insurance requirements: when it applies, 8 policy requirements, and the timeline to account suspension
Amazon US seller insurance requirements: when it applies, 8 policy requirements, and the timeline to account suspension

What is Product Liability in the USA?

In the United States, product liability refers to the legal responsibility manufacturers, distributors, and retailers have for any injuries or damages caused by their products. If a product is defective or causes harm, businesses can be held accountable under US law. This includes any issues arising from design defects, manufacturing flaws, or insufficient warnings and instructions. As a seller on Amazon, it’s crucial to recognize that you may be held liable for product-related injuries—even if you didn’t manufacture the product yourself.

What is the Regulatory Framework Tied to Product Liability in the USA?

The regulatory framework governing product liability in the USA is shaped by both federal and state laws. The most significant federal law is the Consumer Product Safety Act (CPSA), which regulates the safety of consumer products. Additionally, state-specific laws can vary, but they all share the principle that companies must ensure their products are safe for consumers. Many states also follow strict negligence and strict liability principles, which can make businesses vulnerable to lawsuits, even if they weren’t directly negligent.

For sellers on Amazon, complying with both federal and state product safety regulations is critical to maintaining a compliant business. Failing to meet these standards can expose you to significant legal risks, fines, and damage to your reputation.

What is Product Liability Insurance?

Product liability insurance is a specialized insurance coverage that helps protect your business in the event that your product causes harm or injury to a consumer. This coverage can help cover the costs of legal fees, settlements, medical expenses, and damages resulting from lawsuits or claims related to your product. In the USA, product liability insurance is especially important for businesses selling products online, as the risk of customer complaints, claims, and legal action is ever-present.

For Amazon sellers, this type of insurance offers essential protection, ensuring that if your product causes harm, you won’t be left paying out of pocket for costly claims or legal battles.

Important: a standalone product liability policy on its own does not meet Amazon’s requirement. Amazon requires a commercial liability policy (Commercial General, Umbrella or Excess Liability) that includes product liability cover.

What Are Amazon’s Insurance Requirements for Sellers?

Under Section 9 of the Amazon Services Business Solutions Agreement, you must obtain and maintain commercial liability insurance within 30 days after exceeding US$10,000 in gross sales in any single month on Amazon.com, or whenever Amazon requests it.

Your policy must meet all of the following:

  1. Right policy type: Commercial General, Umbrella or Excess Liability.
  2. Occurrence-based: written on an occurrence basis, not claims-made (with limited exceptions for certain product categories).
  3. US$1,000,000 minimum: per occurrence and in aggregate. This minimum is the same for all sellers, whatever you sell.
  4. Covers your products: product liability, products/completed operations and bodily injury.
  5. Amazon as additional insured: the policy must name “Amazon.com Services LLC and its affiliates and assignees” as additional insureds.
  6. Name matches Seller Central: the insured name must match the legal entity name registered in your Amazon account.
  7. 30 days’ notice to Amazon: your insurer must notify Amazon at least 30 days before cancelling, changing or not renewing the policy.
  8. Complete, signed and current: the policy must include a policy number, be signed, and be valid for at least 60 days from the date you submit it.

Once you have a compliant policy, upload your Certificate of Insurance (COI) in Seller Central under Settings › Account Info › Business Insurance.

What Happens If You Don’t Comply? Non-Compliance Leads to Account Suspension

  • Day 0: Amazon requests proof of insurance.
  • Day 30: Deadline to upload a compliant Certificate of Insurance.
  • Day 60: If Amazon still hasn’t received or verified your insurance, your payouts are held.
  • Then: Your seller account is suspended.

Certificates are commonly rejected for using the wrong policy type, limits below US$1 million, a missing policy number, or not naming Amazon as an additional insured. Getting it right the first time protects your cash flow and your account.

What Are the Key Challenges for SMEs When It Comes to Amazon Liability Insurance?

For small and medium-sized enterprises (SMEs), securing the right liability insurance can be challenging for several reasons:

  1. Cost: High premiums can be a barrier for small businesses, especially those with limited budgets.
  2. Understanding Coverage: Navigating the different types of policies and coverage options can be overwhelming. Not all policies cover the same risks, and not every policy is accepted by Amazon.
  3. Complexity of Compliance: Meeting both Amazon’s insurance requirements and local regulations can be confusing, particularly for SMEs without legal or compliance expertise.
  4. Finding Cover Outside the US: Many US-focused insurers don’t cover companies registered in Malaysia or Singapore, leaving Southeast Asian sellers without an easy route to compliance.
  5. Risk Assessment: Understanding the liability risks of your specific products can be difficult, especially if you’re offering a variety of goods with differing levels of risk.

However, the right Amazon-compliant liability policy can mitigate these risks and provide your business with the protection it needs to thrive.

What Are the Benefits of Liability Insurance for SMEs Selling in the USA on Amazon?

For SMEs selling on Amazon, the right liability insurance offers several key benefits:

  1. Be in compliance with Amazon’s requirements and avoid held payouts and account suspension.
  2. Financial Protection: If your product causes injury or damage, insurance helps cover legal costs, settlement fees, and medical expenses—protecting your business from significant financial loss.
  3. Peace of Mind: With liability insurance in place, you can focus on growing your business, knowing that you have protection should anything go wrong with your products.
  4. Reputation Management: Handling claims efficiently and professionally (with the help of insurance coverage) can boost your reputation as a responsible and customer-focused seller.
  5. Risk Management: Insurance allows you to assess and manage the risks associated with your products, giving you the ability to act proactively if issues arise.

A New Partnership for Your Business Protection

Everpeaks and N Bright Consultancy partnership with Tokio Marine Insurans (Malaysia) Berhad

We’re excited to announce a new partnership between Everpeaks and N Bright Consultancy, an authorized agency of many GLOBAL insurance companies. Together, we’ve crafted a cost-effective, Amazon-compliant liability insurance solution designed exclusively for Malaysian and Singapore companies selling in the USA on Amazon.

We have proof it works:

Amazon Seller Central confirmation that the seller's insurance was accepted

This partnership offers commercial liability coverage, including product liability, that meets Amazon’s marketplace insurance requirements and is designed with the USA’s regulatory standards in mind. Our solution is streamlined, affordable, and tailored to the needs of e-commerce sellers. With our solution, you can rest assured that your business is protected against potential claims, giving you the confidence to grow and succeed in the highly competitive Amazon marketplace.

Who Is This For?

  • Companies registered in Malaysia or Singapore
  • Selling physical products on Amazon.com (US)
  • Approaching or above US$10,000 in monthly Amazon sales, or who have received an insurance request from Amazon

Ready to Protect Your Business?

Don’t wait for an Amazon notice, a held payout or a suspended account to put your business at risk. Fill out the form below for a free quote and to learn how we can help you secure Amazon-compliant liability insurance, backed by a trusted partnership with Tokio Marine Insurance.

GET STARTED TODAY!

This page is general information based on Amazon’s published commercial liability insurance requirements as of October 2026. Requirements can change; always confirm in Seller Central. Cover is subject to underwriting. Everpeaks is not affiliated with Amazon.