E-Commerce Business Insurance: Best Companies and Coverage Types
Most online retail businesses should have general liability insurance with product liability coverage.
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Updated · 6 min read
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Contributing Writer Online businesses don’t have some of the risks that brick-and-mortar stores face, like slip-and-fall accidents or damage to a storefront. But e-commerce businesses still need insurance.
Most online retailers should have:
- General liability insurance. This policy pays out for claims of injury, property damage or copyright infringement against your business.
- Product liability insurance. This covers things like customer injury from your product and inventory damage.
Some third-party platforms, like Amazon and Walmart Marketplace, may require proof of business insurance to allow you to sell using their site.
Here’s what you need to know about e-commerce business insurance and our picks for the best coverage options.
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Best e-commerce business insurance options
The right business insurance company for you is one that offers you the best coverage at the best price. We advise getting multiple quotes before choosing an insurer, since costs can vary from one company to the next.
NerdWallet’s editorial team chooses the best business insurance companies based on:
- The number of complaints to state insurance regulators relative to company size.
- Having a good ability to pay claims based on financial strength, according to credit rating agencies.
- How easy it is to get a quote and buy a policy online.
- Unique features and policies that may be advantageous to e-commerce businesses.
Here are some of our top companies that serve online sellers. We recommend getting multiple quotes to find the best coverage at the best price.
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Ergo Next
Ergo Next offers an e-commerce business insurance policy that complies with Amazon’s requirements for sellers clearing $10,000 in monthly sales. You can get a quote online within minutes. If you buy a policy, you can generate unlimited copies of your certificate of insurance online — which you may need to provide as proof of coverage.
Thimble
Thimble is an insurance agent. Since it doesn't underwrite insurance policies, we don't give it a star rating.
Need to expand your business insurance coverage to comply with the requirements of a contract — like one for a craft fair? Consider buying temporary coverage from Thimble, which offers coverage by the event or by the month. Thimble offers coverage packages tailored to a variety of craft businesses, including candle-makers, jewelry-makers and leatherworkers.
Thimble also offers an Amazon Seller policy designed to comply with Amazon’s requirements. Read NerdWallet’s review of Thimble business insurance.
Chubb
Chubb sells a business owner’s policy online for companies that generate less than $2 million in annual revenue. It may be a good choice for e-commerce businesses that store inventory. Its BOP includes commercial property, business interruption insurance and extra expense coverage, which can help you recover after a property-destroying accident or disaster. You can tack on data breach coverage, too. Read NerdWallet’s review of Chubb business insurance.
The Hartford
The Hartford offers policies tailored to meet Amazon’s requirements for sellers. Data breach insurance is available as well. You can get a quote online, but some businesses may have to pick up the phone to buy coverage. Read NerdWallet’s review of The Hartford business insurance.
Save up to 30% on business insurance
NerdWallet Small Business helps you get real-time quotes from 30+ insurers, and instant access to your Certificate of Insurance (COI) through our partner, Coverdash.
Do online businesses need insurance?
Typically, yes. Even if you operate a small online company, you still face risk. For instance, a customer could sue you over a defective product, or a fire could destroy your inventory. Insurance would cover those costs so you don’t have to.
Online retailers should get insurance if any of these scenarios applies:
- You sell on a major marketplace. Sites like Amazon and Walmart Marketplace require specific liability limits if you make sales over a set amount.
- You have business property. Products in storage or, for instance, equipment in a woodworking shop could be stolen or destroyed by a natural disaster.
- You operate out of your home. Products in your home could be damaged or destroyed during non-business activities, or someone could be injured doing business with you. Home insurance is likely to deny or limit payouts on these claims.
- You resell or handmake items. You can be held liable for defects of your items whether you make them or not. Some online store builders (like Shopify) and marketplaces (like Etsy) don’t require insurance for you to use them. But they also don’t protect you if a customer sues your shop.
What types of insurance do e-commerce businesses and online retailers need?
Most e-commerce businesses should have standard general liability insurance to cover claims of third-party bodily injury and property damage. For online retailers that sell physical goods, product liability insurance can offer specific coverage for claims related to defective or flawed items.
Whether you need additional insurance depends on several factors, including the location of your business, whether you deliver products and how many employees you have.
General liability insurance for e-commerce businesses
Typically, general liability insurance policies cover the following:
Bodily injury: Third-party claims of bodily injury as a result of interacting with your business. For example, say a delivery driver visits your home to drop off a shipment for your business. They trip over a broken stair on your front porch, breaking an arm. This policy would cover medical bills, legal fees and settlement costs associated with the incident. While home insurance would normally cover these costs, personal policies often exclude injuries from home businesses.
Property damage: Third-party claims of property damage as a result of interacting with your business. For instance, a customer comes to your home-based business to pick up an online order. While taking their payment, you spill a cup of hot coffee on the table that fries the customer’s cell phone. Your general liability insurance will cover the costs to replace it.
Personal and advertising injury: Third-party claims of libel, slander or copyright infringement made against your business. Say one of your employees publishes a promotional article on your e-commerce website. In it, they make a false statement about a competitor — and the competitor reads the article and sues your store. This policy will cover any associated legal fees and settlement costs.
Product liability insurance for e-commerce businesses
Product liability insurance helps protect your business from third-party claims of bodily injury or property damage caused by a product that it made or sold. This insurance can cover physical or property damage as a result of:
- Manufacturing defects.
- Design flaws.
- Failure to provide adequate instructions, labels or warnings.
Most general liability insurance policies include “products and completed operations” coverage, which provides that protection. However, it’s critical you check this policy detail to confirm coverage.
But businesses facing greater product liability risks — like those that manufacture or sell products for kids — may want to consider buying a separate product liability insurance policy.
Additional insurance options for e-commerce businesses
Although general and product liability insurance may be sufficient for some e-commerce businesses, others may benefit from some of these additional types of business insurance.
| Type of insurance | What it covers |
| Financial losses if your property is damaged due to certain weather events, hazards and accidents. Get this if: You keep inventory in stock or own real estate, like storage or warehouse space. | |
| Employee medical expenses for work-related illnesses or injuries. Get this if: You have a staff. Most states require employers to have workers' compensation for their employees. | |
| Financial losses caused by cyber incidents such as data breaches, ransomware attacks and hacking. Get this if: You keep customer data on file. | |
| Lost income and operating expenses, such as payroll and rent, after a major disaster that strikes your business property. Get this if: You also have commercial property insurance. | |
| Business property while it’s in transit or while it’s stored at a third-party location. Covers damage that results from theft, vandalism, as well as certain hazards and weather events. Get this if: You deliver or ship goods yourself. | |
| Damage to a work vehicle or injuries sustained in an accident while driving one. Get this if: You have a vehicle just for transporting business supplies or inventory. | |
| Claims of error, professional negligence, breach of contract or failure to deliver a promised service on time. Get this if: You do work for clients for a fee, such as design business marketing materials. |
E-commerce businesses looking to purchase multiple types of insurance may opt to buy a business owner’s policy, or BOP. Typically, a BOP combines general liability insurance, commercial property insurance and business interruption insurance.
You may find a business owner’s policy allows you to add data breach or cyber liability coverage, as well as professional liability insurance.
For smaller online retailers that only need a few types of coverage, business owner’s policies can be more cost-effective than purchasing multiple policies separately.
How much does e-commerce insurance cost?
Online merchants pay a median of $850 per year for general liability insurance, according to data provided to NerdWallet by online brokerage Coverdash.
A business owner’s policy with coverage for stored inventory costs a median of $2,000 per year. Cyber insurance costs a median of $1,500 for online retailers.
Ultimately, the cost of your business insurance will depend on a variety of factors, such as:
- Number of policies you need.
- Extent of your coverage and your policy limits.
- Business location.
- Products or services you offer.
- Number of employees you have.
- Your business assets.
- Previous claims history.
Typically, businesses with higher risk need more insurance coverage — and that will have higher costs.
A home-based e-commerce retailer with limited customer foot traffic will likely have relatively low insurance costs. On the other hand, an online business with multiple employees or one that runs operations through a warehouse will pay more.
To find out how much e-commerce insurance will cost your online store, we recommend getting several business insurance quotes.
How to get e-commerce business insurance
To get business insurance for your e-commerce store, you can follow these six steps:
1. Gather your company details
You’ll need key information handy, like your company name, years in operation, sales numbers and operating addresses. If you’re a sole proprietor, you’ll need to provide a Social Security Number. If you have employees, you’ll need a roster with salary info and also your Federal Employer Identification Number (FEIN). It’s also a good idea to have lists and values of your property, vehicles and inventory on hand.
2. Decide which types of policies you need
Based on the risks you’ve identified, you can determine which e-commerce insurance policies will best protect your business. General liability and product liability coverage can be good options to start for most online retailers, but additional policies — such as cybersecurity insurance, worker’s comp and commercial property insurance — can be beneficial as well.
3. Choose how to shop
You can work with a broker, use an online marketplace or contact insurance providers directly. As an online retailer, you may find it easier to opt for either of the latter options. Each is typically much quicker than working with a broker. However, if you have more complex needs, such as a warehouse with large equipment and employees manufacturing items, a broker can talk them through.
4. Pick a provider
NerdWallet recommends getting quotes from multiple insurance providers before making a decision. In order to choose the provider that’s best for your business, you’ll want to look at factors such as:
- Policy coverage.
- Liability limits.
- Cost.
- Provider reviews and complaints.
- Customer service.
Look closely at these factors to try and compare prices for similar coverage. Double-check that your final policy or bundle covers product liability.
5. Buy your policies
After you’ve determined which provider is right for your needs, you’re ready to purchase your e-commerce business insurance. Once you’ve purchased your coverage, you can set up your online account.
If available, set up monthly payments and learn how to file a claim. You should also make sure that you know how to contact customer service — and, if you need a certificate of insurance to sell using an online marketplace like Amazon or Walmart — that you request it from your provider.
6. Keep your policies up to date
You should renew your e-commerce insurance on an annual basis. When your policies are up for renewal, you can reevaluate your risks to determine if you need to change or adapt your coverage. However, if your online store experiences an impactful change before your policy is up for renewal, such as hiring your first employee, you can reevaluate your insurance coverage at that time.
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Methodology
Business insurance ratings methodology
NerdWallet rewards business insurance companies for reliability and good service. We calculate star ratings based on scores in about a dozen categories. These include:
- Each company's financial strength.
- How many complaints customers made relative to its market share.
- How easy it is to get coverage.
- How accessible customer service is.
Learn more about how we rate small-business insurance companies.
Our editorial team routinely fact-checks and updates these data points. We also adjust our scoring on an ongoing basis. This helps our star ratings reflect changing industry norms. For instance, in 2026, we began evaluating how easy insurers make it to add an additional insured.
Our ratings are a guide. But insurance policy details and prices can vary widely. We encourage you to shop around and compare several insurance quotes.NerdWallet does not receive compensation for any reviews. Read our editorial guidelines.
Insurer complaints methodology
One key factor in our star ratings is how many complaints insurance companies get. Here's how we arrive at that score.
Disappointed customers can file a complaint with their state's insurance department. The National Association of Insurance Commissioners (NAIC) collects, analyzes and groups complaints by business line and insurance company every year. A business line is a specific type of coverage, like workers’ comp.
Then, the NAIC calculates a complaint ratio for each company. It divides the company's share of complaints by its share of total premiums for each line of business. It then adds these ratio values to their official complaint index.
- A complaint ratio of 1 means a company received about the expected number of complaints relative to its size.
- A ratio of 2 means it received twice as many complaints as expected.
- A ratio of 0 means it received half as many complaints as expected.
NerdWallet obtains the raw NAIC data every year. We aggregate results at the company level and fact-check these results. Then we calculate a three-year average of each insurer's complaint ratio and convert it to a score for our star ratings.
Business insurance star ratings consider complaints about two lines of business: commercial liability and commercial property. We analyze complaint data on commercial auto and workers' comp policies too. But we don't currently incorporate these into our ratings since they're less universal.
