Etsy Seller Insurance

Etsy Seller Insurance

Etsy seller insurance provides financial protection against the unique risks you are exposed to as an Etsy store owner, such as allegations of defective products and cyber-related claims.

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Insurance for Etsy sellers

If you’re venturing into the Etsy marketplace for the first time, or you’re a veteran at selling your products online, it’s vital to safeguard your business. While selling online can alleviate some of the risks you can face if you sell in a physical space, your business can still be vulnerable to inventory theft or damage. Additionally, you can be more susceptible to online threats, such as a cyber-attack or a data breach.

As an Etsy store owner, you need an insurance policy that can protect you financially against allegations of faulty products and general liabilities.

Our Etsy insurance policy packages protect small business owners against the risks associated with producing and selling merchandise online, like cyber risks and liable events of third-party property damage or bodily injury.

A comprehensive Etsy seller insurance package will typically include the following coverages:

  • Commercial General Liability (CGL) Insurance: While it’s likely you conduct most of your business online (especially if you sell your products exclusively on Etsy), you can still find yourself liable for claims of third-party injury and property damage. Thankfully, claims like these can be covered by CGL. For example, a prospective customer is visiting your home to pick up their order in person and they trip over your front doorstep. As they’re at your home for business purposes, your CGL insurance can cover the legal expenses and relevant medical fees, regardless of the lawsuit’s outcome.
    • Product Liability Insurance: As a part of CGL insurance,  product liability protects you against claims alleging third-party property damage or bodily injury that was caused by a product you manufacture, distribute, or sell, generally due to a defect of some manner. For instance, say a customer claims the organic body lotion you made caused a severe allergic reaction. Your product liability insurance could cover the legal fees and their medical expenses.
  • Cyber Liability Insurance: This is one of the most important coverages for retailers selling products online – especially if you store customer data. Cyber insurance covers costs associated with technological incidents, such as a cyber hack involving your computer systems and data. For example, you open a malicious link on a spam email which allows a scammer to access your customers’ financial data. Cyber liability insurance could cover the cost to notify customers and secure your data system, as well as any legal expenses from the data breach.
  • Contents Insurance: If you store stock and own business-related equipment, it’s important to have contents insurance. It can protect stock, equipment, furniture and machinery from insured risks that occur beyond your control, such as a fire or theft. For example, suppose you store a lot of stock in your home office, and you experience a fire that destroys the majority of your inventory. Contents insurance can cover the replacement value of that inventory.

Additional coverage to consider:

For a low-risk, small business selling products on Etsy, you can anticipate a starting cost of approximately $500 annually for a basic CGL policy.

However, similarly to brick-and-mortar businesses, many factors can influence the cost of an insurance policy for your Etsy store. For instance, if you sell expensive products, such as luxury jewelry or technology, you may experience a higher premium than someone who sells low-value products.

In the quoting process, we’ll ask some simple questions that’ll help us determine what coverage you should have. Below are some of the main factors insurance companies take into consideration when pricing your policy:

  • Sales volume
  • Type of products sold
  • Value of inventory
  • Number of employees
  • Claims history

To get you the best price for your business, we’ve partnered with more than 50 insurance providers so we can offer you the best coverage to suit your specific needs.

While Etsy doesn’t require insurance to become an Etsy seller, it’s essential for any business that sells, develops, or manufactures products and sells them online.

Getting insured is quick and easy!

Complete our 5-minute online application for a free Etsy insurance quote.

Common claims scenarios

homemade jewelry on display

Problem: You create homemade silver jewelry. After a customer has a severe allergic reaction to the earrings they purchased, they accuse you of using a cheaper metal, rather than silver. They sue you for their medical costs and file a lawsuit against your company.

Outcome: Your product liability insurance may cover your legal defence fees and the customer’s medical costs.

women working in a shared office

Problem: Your inventory, packaging materials, and work computer are stolen from your workspace within a shared office.

Outcome: Your contents insurance may cover the cost to replace your stolen assets.

custom printed t-shirt

Problem: Your business prints graphic t-shirts and sells them on Etsy. Another company accuses you of copying several of their copyrighted designs and takes you to court.

Outcome: Your commercial general liability policy may cover your legal defence fees and any other associated costs.

Frequently asked questions

Will my Etsy insurance provide coverage for other marketplaces that I sell on?

Yes, Etsy Insurance is simply a group of policies designed to protect the business activities of Etsy sellers, but similar online marketplaces can be covered under this type of insurance package. When you make a quote, you’ll be asked questions about your business that will help us determine the coverage you need, but feel free to reach out to a broker if you have any questions.

Does my insurance cover product shipping or returns?

No, however, you can get shipping insurance through Etsy to cover certain losses or damage to your products during shipping.

Does Etsy offer insurance?

No, Etsy doesn’t offer insurance that will cover product liability or other types of liability claims. Etsy only offers shipping insurance, providing coverage against loss or damage to products during shipping.

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Ready to start? Let’s get a quote!

You know how easy it is to set up an Etsy store, we’ve made it just as simple to get an insurance quote online. Fill out an application today to get a free quote.

Give your Etsy business the coverage it needs to face the unexpected. If you have any questions, one of our brokers will happily guide you through the process.