Amazon Updates Liability Insurance Rules for Third-Party Sellers in 2025
Starting in 2025, Amazon requires any third‑party seller whose monthly gross sales exceed $10,000 to provide a liability policy of at least $1 M per occurrence and $1 M aggregate. Sellers have a strict 30‑day window to upload the certificate, after which Amazon’s compliance team reviews it within 48‑72 hours before listings stay active.
Overview
Amazon has tightened its liability‑insurance policy for third‑party sellers, making the rules effective for any seller who tops $10,000 in gross sales in a single month. The update adds a proactive notification duty, shortens the compliance window to 30 days, and changes the documentation process in Seller Central. Sellers who ignore the new standards risk immediate listing suppression and a loss of sales momentum.
Key Points
- 30‑day compliance clock — Once a seller’s monthly gross sales exceed $10,000, Amazon gives exactly 30 days to upload a qualifying policy before listings are hidden.
- Proactive notice required — Sellers must alert Amazon before an insurance policy expires or is materially altered, replacing the previous “Amazon will notice you” approach.
- $1 M minimum coverage — Acceptable policies must provide at least $1 million per occurrence and $1 million aggregate for product liability, completed operations, bodily injury, personal injury, broad‑form property damage, and broad‑form contractual liability.
- No additional‑insured clause — Amazon no longer demands that sellers name Amazon.com Services LLC as an additional insured, cutting typical endorsement fees by up to 25 percent.
- Two‑to‑three‑day verification — Uploaded certificates are reviewed by Amazon’s compliance team within 48‑72 hours; any mismatch triggers a rejection and restarts the 30‑day clock.
How the New Insurance Requirements Work
- Sales trigger detection — Amazon’s system scans monthly gross proceeds; for example, a seller of kitchen gadgets who records $12,500 in May will automatically receive a “insurance required” alert on June 1.
- Notification and upload — The seller must log into Seller Central, navigate to the Insurance section under Account Settings, and upload a certificate that lists the exact legal business name, coverage limits, effective dates, and Amazon.com Services LLC as a certificate holder. The upload must occur within the 30‑day window; a failure to do so results in immediate listing suppression.
Analysis & Recommendations
Why This Matters
If a seller hits the $10,000 threshold and fails to upload a qualifying $1 M policy within 30 days, Amazon will hide their listings, causing loss of sales momentum. The new proactive notice and 48‑72 hour verification mean sellers must adjust their risk‑management calendar and ensure certificate details match Seller Central exactly.
Key Takeaways
- The compliance clock starts once monthly gross sales top $10,000, giving sellers exactly 30 days to upload a policy.
- Accepted policies must have minimum $1 M per occurrence and $1 M aggregate limits for product liability and related coverages.
- Amazon reviews uploaded certificates in 48‑72 hours; any mismatch restarts the 30‑day clock.
- The additional‑insured clause for Amazon.com Services LLC is removed, potentially saving sellers $75‑$125 annually on premiums.
Recommended Actions
- →Log into Seller Central > Account Settings > Insurance and set a calendar reminder 45 days before any policy expires.
- →Upload the liability certificate within the 30‑day window and verify the legal entity name matches exactly what appears in Seller Central.
- →Monitor the compliance status in Seller Central > Account Health to confirm the certificate is approved within 48‑72 hours.
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