General Liability for Online & Etsy Sellers
Running an online-only business comes with distinct advantages. You don’t have to worry about a brick-and-mortar storefront, stock shelves, sweep floors, or change out of your sweatpants to chat with your customers. If you’re selling on Amazon, Etsy, or any other online marketplace, you are free to focus on creativity, logistics, and customer emails.
That doesn’t mean that there aren’t risks involved in running an online store. All businesses involve risk. However, a risk that some online store owners may overlook is their potential legal exposure. There are times when running your business may lead to liability risks that could put you and your business in a tricky situation.
General Liability insurance was made for this. Also known as Commercial General Liability (CGL), this coverage exists to protect businesses when someone outside the company claims they were harmed and holds the business accountable. For online sellers, those claims don’t come from foot traffic but from products, advertising, shipping, and the platforms themselves.
Selling Physical Products
If you sell physical products online and someone claims they were harmed by your product, your business could be held responsible. Where it was sold is often not important because if your defective item is at fault, and your name is on the listing, you could still be involved in a lawsuit. General Liability can step in to help cover legal costs and damages resulting from these kinds of lawsuits.
Print-on-Demand
Print-on-demand businesses often feel especially insulated. You don’t touch the product, you don’t ship it, and production happens elsewhere. But liability doesn’t stop at logistics. If a design causes harm, infringes on another brand, or leads to a claim of advertising injury, claims can still happen. And without a CGL, you could be paying fees and damages out of pocket.
Offline Exposure
There are also times when your business is offline. If you have deliveries to your home, see clients at a craft fair, pop-up market, or trade show, you could be responsible for any accidents that happen on your property or as a result of your actions. General Liability also covers lawsuits and medical costs resulting from those injuries.
Luckily, CGL policies are usually incredibly affordable for most businesses. Policies can be tailored to your business’s needs, making sure that you are covered based on the size and scope of your business, not simply market trends. Some online retailers are now requiring General Liability insurance if they reach a certain monthly sales threshold, making this coverage more important than ever. If you’re curious about General Liability and how it could help your business, talk to your agent today.
This content is from sources believed to be accurate and is for general information only, not tax or legal advice. Consult appropriate professionals for your individual situation. Copyright FMG Suite.
