E-commerce Insurance

E-commerce Insurance

E-Commerce Insurance provides financial protection against the unique risks you are exposed to as the owner of an e-commerce store.

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Zen Man Protected By E-Commerce Insurance
Coverages

What does E-commerce Insurance cover?

A comprehensive E-Commerce Insurance policy package typically includes:
  • Cyber Liability Insurance provides financial coverage for loss or damage to your electronic data resulting from cybercrime, such as a data breach.
  • Product Liability Insurance covers the costs associated with liability claims alleging bodily injury or property damage resulting from a product you manufacture, develop, or sell.
  • Business Interruption Insurance provides coverage for income lost due to an unforeseen event that results in the temporary suspension of your business operations.
Requirements

Who needs E-commerce Insurance?

Whether you run a dropshipping company or manufacture your own products, when it comes to business, insurance is critical to ensuring the long-term survival of your e-commerce store.

Some of our clients include:

  • Dropshipping Companies
  • Subscription Companies
  • E-Commerce Retail Stores
  • Wholesale Companies
  • Manufacturers
Costs

What is the cost of E-commerce Insurance?

Insurance cost will vary from business to business. Factors that are taken into consideration when determining the cost of your policy package include:
  • Sales Volume
  • Type of Products Sold
  • Value of Inventory
  • Number of Employees

Insurance policies for high-risk or expensive products, like fireworks or luxury watches, will have a higher premium.

Considering these factors, policy packages can start at $500 per year for e-commerce stores.

Getting insured is quick and easy!

If ecommerce insurance is what you need, request a free quote now

Common scenarios where E-commerce Insurance is useful

Hacker stealing information

Problem: Your data systems are hacked and your customers’ financial information is compromised.

Outcome: Your Cyber Liability Insurance covers the cost to repair your data systems, as well as legal fees, totaling $225,000.

Fire Damage Inventory

Problem: A house fire destroys your home office, including your inventory.

Outcome: Your Business Interruption Insurance covers income lost during the three months it takes to repair your office and replace your inventory, totaling $15,000. 

Baby Product Accident

Problem: A client claims a product you sold them malfunctioned and caused severe burns.

Outcome: Your client successfully sues for bodily injury. Your Product Liability Insurance covers the legal expenses and medical fees, totaling $89,000.

Which professions require Ecommerce Insurance

Regardless of the type of online business you run, e-commerce insurance is critical:

  • Fashion – clothing

  • Jewellery

  • AR/VR headsets and equipment

  • Online learning platforms

  • Electronics

  • Grocery and food

  • Healthy pet snacks

  • Drones

  • Sporting gear

  • Office supplies

  • Cell phone accessories

  • Cosmetics

Frequently Asked Questions about Ecommerce Insurance

Do I need to carry insurance on my stock if I am operating by dropshipping?

Confirm with your supplier if they are responsible for insuring inventory. However, it never hurts to carry this coverage in the event that you get dragged into a claims scenario. If you have multiple suppliers, it can be difficult to keep track of which suppliers have insurance and which don’t. It is highly recommended that you add Property Insurance to your insurance policy to manage your risks.

Do I need Cyber Liability Insurance if I am operating online?

It is recommended that you protect your business operations with Cyber Liability Insurance if you are selling products online as online transactions usually require an exchange of financial information over the internet. Many online retailers also store customer data to complete and ship out orders. If any third party data on your systems are stolen or damaged in a cyber attack, you may need Cyber Liability Insurance to cover the damages. Cyber attacks are becoming increasingly common. According to StatCan, one-fifth of all Canadian small businesses were targets of cyber attacks in 2017, and the number has only gone up since.

Can my online business be held liable for selling a product that caused injury to a customer, despite the product being manufactured by a different company?

Yes, it is possible that you can be held liable for products you have sold even if you did not manufacture the products. Make sure that products liability coverage is present in your insurance policy. Take a thorough look at your inventory to determine if you sell products that are highly likely to cause injuries, such as products for babies and toddlers. Whenever possible, do business with manufacturers that already carry an insurance policy.

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