As a seasoned Amazon seller, you know that renewing your Amazon seller insurance isn’t just a 5-minute job.
Annual forecasts, upfront charges, and what feels like never-ending paperwork and documentation – the era of traditional insurance models has had its day.
In this guide, we’ll delve deep into the intricacies of renewing your Amazon seller insurance and touch on the new age of eCommerce insurance – ensuring you’re well-equipped to make an informed decision when you’re next due for an insurance renewal.
Let’s go over our 7 tips for renewing your Amazon seller insurance:
- Understand Amazon’s Requirements
- Get Automated
- Work With a Provider That Understands Your Business
- Category Impacts Cost
- Understand the Impact of Your Business Model
- Look Out for the Best Customer Service
- Shop Around
#1: Understand Amazon’s Requirements
The most critical requirement set by Amazon is that if your sales revenue surpasses $10,000 in any given month, you’re mandated to have a Commercial General Liability policy.
But each time you renew your Amazon liability coverage, there are other factors to consider that may affect whether Amazon accepts your policy:
- The policy type: Both claims-made and occurrence policy types are accepted in some instances, but Amazon specifies that claims-made policyholders must obtain a 3-year tail coverage
- Your policy must name Amazon and its assignees as additional insureds
- Your provider must have global claim handling capability and a financial rating of ‘S&P A-’ and/or ‘AM Best A-’ or better
- The deductible for any policy or policies must be under $10,000
- The policy must cover sales of all products that you have listed on the Amazon website
- Your insured name must match the legal entity name you provided to Amazon
Understanding these requirements and communicating them effectively with your insurance provider has the potential to lower your insurance rate whilst also making sure that your certificate will be accepted when you upload it to Amazon.
When it comes to eCommerce and your liability insurance, it’s all about being proactive and making informed decisions.
For a more detailed dive into Amazon’s insurance stipulations, visit our Amazon Insurance Requirements blog to equip yourself with all the knowledge you need.
#2: Get Automated
When the Covid-19 pandemic hit, it changed everything. Almost overnight the new age of digital transformation was here, reshaping industries and changing consumer behaviors.
The insurance sector was no exception to this – At Assureful, we witnessed this monumental shift. The laborious paperwork and tedious annual projections linked to some traditional insurance providers became even more misaligned with how eCommerce sellers conduct business – often entirely remotely.
So, what does this mean when it comes to renewing your Amazon insurance?
- Efficiency & Precision: With digital processes, you receive an exact quote swiftly and efficiently. For most of our clients, that means no more waiting and definitely no more guesswork
- Time Savings: Sifting through heaps of data, making laborious projections, then dealing with your insurance provider over the phone for hours? Those days are behind us. Now, a few clicks and an automated link to your seller accounts are all it takes
For eCommerce sellers, this means one thing: a seamless, hassle-free insurance experience.
#3: Work With a Provider That Understands Your Business
Not all insurance providers are created equal.
If you’re collaborating with a provider who still operates with a brick-and-mortar mindset in this digital age, the disconnect can be palpable. They might not grasp the intricacies of the eCommerce landscape or the specific challenges and opportunities that come with selling on Amazon.
That’s where you need to consider whether renewing your insurance with such a provider is the best option for your business, or choosing an eCommerce specialist provider is the way to go.
Why is this so crucial?
- Tailored Solutions: Generic solutions designed to cover all types of businesses – on and offline – often miss the mark. By understanding the unique challenges of Amazon sellers, we ensure our insurance products are a perfect fit.
- Risk Management: Being well-versed in the eCommerce structure allows us to anticipate potential risks and offer proactive solutions.
- Peace of Mind: Knowing that your insurance provider truly ‘gets’ your business means you can focus on what you do best: selling.
In essence, choose a partner who understands, supports, and empowers your eCommerce business.
#4: Category Impacts Cost
Take this scenario: You’re selling a children’s jigsaw puzzle. It’s designed with large pieces, ensuring there’s no risk of a child swallowing them. By all accounts, it’s a safe, low-risk product. Yet, when approaching some traditional insurers, they lump your jigsaw puzzle into the broad category of “baby toys” – a category deemed high-risk.
Suddenly, the premium for your jigsaw puzzle is on par with high-risk teethers, inflating your premiums unnecessarily.
This is a classic example of how broad category-based assessments can skew insurance costs. But at Assureful, we believe in a different approach.
- Precision at its Best: We use over 30,000 product categories and analyze over 400 data points to accurately assess each product. From historical sales data and product types, to seasonality trends and claims history – we leave no stone unturned
- Tailored Quotes: By understanding your product at the SKU level, we ensure that you get a quote that truly reflects its risk profile. No more overpaying due to generalized category assessments
- Informed Decisions: With our detailed insights, you’re empowered to make informed decisions, ensuring your product is insured accurately and fairly
#5: Understand the Impact of Your Business Model
The business model you adopt plays a pivotal role in determining your insurance premiums. When it comes to renewals, there isn’t any action you can take here to reduce your premiums – after all, you’re already in operation. But, it pays to be informed and understand how your operations can affect your coverage. Here are two examples:
Private Label Sellers: If you’re a private label seller sourcing your products from overseas, you’re generally labeled as the “manufacturer” in the eyes of your insurer. This distinction comes with its unique set of challenges. For instance, if a product defect arises, the responsibility falls squarely on your shoulders, not the original manufacturer.
Retail arbitrage: In comparison, in the retail arbitrage model, whereby sellers resell products manufactured by other brands, the responsibility for product liability claims may be transferred to the original manufacturer.
Many eCommerce entrepreneurs have faced the cold shoulder from traditional insurers, especially when their products are manufactured outside the US, due to the nuances that accompany the many eCommerce business models. It’s a common grievance, and we hear it time and again.
#6: Look Out for the Best Customer Service
When technical jargon can get too complicated and the claims process a little daunting, the value of great customer service cannot be understated.
So when you’re considering your renewal, the ability to communicate with and trust your provider is a non-negotiable.
Open Channels of Communication: When you work with an insurance provider that prioritizes open dialogue, you’re no longer just another policy number – you’re a valued partner. This open channel ensures that you secure better rates tailored to your specific needs and that any concerns or queries you have are addressed promptly.
Peace of Mind in Claims Handling: The true test of a provider’s commitment to customer service is during the claims process. It’s a time of uncertainty, and having a provider who stands by you, guiding you at every step, is invaluable. With strong communication, the claims process transforms from a potential nightmare to a structured, transparent procedure.
Assureful’s Commitment: We understand the pivotal role that customer service plays in the insurance journey. Our commitment is unwavering:
- Personalized Attention: Every query, and every concern is addressed with the utmost care.
- Transparent Processes: We believe in keeping you in the loop, ensuring you’re well-informed at every stage.
- Dedicated Claims Support: In the event of a claim, our team is right by your side, ensuring a smooth, hassle-free process.
#7: Shop Around
In an industry that has such tight profit margins, every business decision you make can have a significant impact on your bottom line. So when your liability insurance is up for renewal, choosing the right policy and partner is of the greatest importance.
Like most insurance policies – business or personal – sticking with your existing provider may not always be the best option, especially if that coverage is based on annual forecasting – so shop around.
Just as every eCommerce business is unique, so too are their insurance policies. What works for one seller might not work for another. This isn’t a realm where a one-size-fits-all approach is going to cut it. It’s a dynamic space, and your insurance provider should approach it that way too.
Why shopping around matters:
- Tailored Solutions: By exploring various options, you can find a policy that aligns perfectly with your business model, risk profile, and budget.
- Competitive Rates: Comparing offerings allows you to secure the most competitive rates, ensuring you’re getting the best value for your investment.
- Comprehensive Coverage: Different providers might offer varying coverage elements. Shopping around ensures you’re not missing out on any crucial protection.
We believe in empowering our customers with knowledge. While we’re confident in the value and comprehensiveness of our tailored Amazon coverage, we also understand the importance of making an informed decision. We encourage all online sellers to explore, compare, and then choose the best fit for their business and their needs.
Don’t forget: After you’ve diligently compared policies and chosen the right fit for your business, there’s one crucial detail you mustn’t overlook. Always remember to re-upload your new Certificate of Insurance (COI) to Amazon Seller Central whenever you secure a new policy. Amazon might not send out reminders, but this is a vital step in ensuring continuous coverage and compliance.
Navigate Your Amazon Insurance Renewal With Confidence
From understanding Amazon’s intricate requirements to embracing the digital revolution in insurance.
From recognizing the nuances of product categories to choosing a provider that truly understands your business model.
Every decision plays a pivotal role in safeguarding your Amazon business.
Your insurance provider should be more than just a company you pay premiums to. They should be allies and partners.
At Assureful, we pride ourselves on being that ally to eCommerce business owners. We’ve walked the eCommerce path, faced its challenges, and emerged with insights that we’re eager to share. Our mission is to ensure that every online seller has access to tailored, dynamic insurance solutions – with monthly premiums starting from just $26.
No obligation quote.
Policies can be canceled at any time, with 30 days’ notice.