How To Make an Amazon Seller General Liability Insurance Claim?

Selling online opens up a whole world of opportunities, literally. You can put up an eclectic mix of products and still be able to find a buyer base and thrive. However, in the rush of the virtual market, it is easy to ignore the rather dry subject of insurance. That would be a grave mistake, on the off chance that your product causes a personal injury or damage to your buyers, your general Amazon liability insurance becomes a shield for your business. Plus, if you are an Amazon seller, you’re required by Amazon to have general liability insurance.


So, today, we will attempt to cover every possible aspect of general liability insurance claims – when to initiate a claim, how to do it, and what to expect if you do not have general liability insurance.

Let’s start with the basics.

Step 1: Keep Calm & Call In The Experts

An incident involving your product has occurred wherein a buyer has suffered a personal injury or damage to their private property. You worry that you might get sued when you find out about this incident. In such a situation, start by reaching out to two of your contacts – your general liability insurance policy provider and your lawyer.

Contact 1: Insurance Provider

As soon as you get information about your customer’s accident involving your product, get in touch with your general liability insurance provider. Do it even if there is no legal claim initiated by them yet. A heads-up will allow your insurance provider to investigate the claim and maybe save you from an expensive litigation process.

If you are not sued, it makes good business sense to report the incident to the insurance provider. It will ensure that a past accident will not affect your business’s present and future.

Contact 2: Lawyer

If you operate as a sole proprietorship, you can respond to the lawsuit on your own. However, if you sell products registered as an LLC or a corporation, you must be represented by a lawyer.

Suppose you do get sued. Given the critical nature of the case, we strongly recommend that you get in touch with your lawyer.

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Step 2: Get the Insurance Documents in Order

Take a moment to carefully review your general liability insurance policy terms and keep all the information handy to share with your insurance provider when requested. These will include your policy number, coverage type, and description of the current claim.

Ensure that you all the details of the claim because it might affect how much damages the insurance will cover.


Step 3: Reach Out to Your Case Officer

If you struggle with understanding the process or have any questions, get help from the insurance executive assigned to your case.

  • How much time does it take to file a claim?
  • What percentage of the claim amount will the policy cover?
  • How will the situation change if a lawsuit is filed?
  • What challenges might I face?

Your insurance agent is a reliable source of information regarding the claims process and they will know if your policy is in line with the platform’s insurance requirements. They will also have answers to any general questions you may have about your general commercial liability insurance policy.

Step 4: Keep Track of All Case-Related Communication

When the claim is under process, you will receive communication from multiple stakeholders – the insurance provider, litigating customer, and any other third parties involved. As a rule of thumb, keep track of all the communication related to the case, including phone conversations, emails, physical mail, and even face-to-face conversations. If you get requests for documentation or any specific details, do it in writing and always keep a copy of all communication with you.

Once the claim is processed, you can cover the damages sought by the aggrieved buyer from the claim amount.

Step 5: You are Sued

Stay in touch with your lawyer and insurance provider if you are sued. Following a legal consultation and recommendation from your insurance provider, you may take one of the following three approaches:

  • Respond To the Complaint

You can send a legal response to the claim by accepting or denying the allegations. You will have to explain your response in either case and prove it in court.

  • Demand Dismissal

You may also demand outright dismissal of the case. The reason for case dismissal can be wrong jurisdiction, the trivial nature of the claim, or other legal grounds.


  • Settle The Claim

If the case has the potential to damage your brand image or linger in court to become too expensive for you, both your lawyer and insurance provider may ask you to settle it with money quickly.

The legal route you choose should be taken after considering all the pros and cons with the professionals. Your general liability insurance will take care of the rest. However, in the unlikely scenario that you do not have general liability insurance for business, here is what you can expect.

Every business, whether you are a physical retailer, online store, or an Amazon seller, needs general liability insurance. Foregoing it can have devastating consequences on your business’s future. Do not, under any circumstances, choose to conduct your business without insurance. Here are some of the ways your business can suffer because of your decision to save a few dollars a month in insurance  premiums.

  • Ignoring the Inevitable

Damage claims and business operations go hand-in-hand. Many businesses have had to go through the painful process of getting sued or having a claim brought against them. The best way you can protect yourself as a business owner is by making sure you have liability insurance and that it is compatible with the platform that you sell on. So, by not getting general liability insurance, you are just becoming a sitting duck waiting for the inevitable. Once you purchase insurance, don’t forget to upload it to your platform!

  • Investment vs. Expense

It’s high time for businesses to change how they view insurance. It is not a cost center; it’s an investment into their future. It’s akin to investing in chains for your tires when you know a snowy season is just around the corner.

  • More than Monetary Damage

If you cannot pay the damages to the aggrieved buyer, the case may escalate and damage your businesses’ brand equity and industry reputation. Such non-monetary damages may become irreparable.

  • Exposing Your Business

Without insurance, your business stands completely exposed. General liability insurance can protect you from complete ruin. While traditional insurers tend to provide quotes that are expensive and non-reflective of an eCommerce business, digital brokers such as Spott can provide competitive quotes from top insurers with the click of a button. We make getting insured, quick, easy and cost-effective by bridging the gap between eCommerce seller and insurer.

Stop procrastinating. Protect your business. Save 30% or more on your Amazon seller liability insurance in just 3 minutes with Spott. It doesn’t get better than this!


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