Amazon Liability Insurance: What Sellers Need to Know

Amazon is tightening its commercial liability insurance requirements, creating a significant compliance change for sellers operating in higher-risk product categories.

Effective November 2, 2026, the updated requirements remove the previous $10,000 monthly gross proceeds threshold for sellers with products in Amazon's enhanced safety categories. The update also introduces stricter insurance-provider requirements for sellers whose businesses are headquartered in Mainland China.

For sellers, the key issue is no longer simply whether sales are high enough to trigger insurance requirements. Even low-volume or dormant listings may require compliant coverage.

1. What Is Changing in Amazon's Insurance Requirements?

Amazon's updated liability insurance requirements introduce two major changes for sellers.

First, the previous $10,000 monthly gross proceeds threshold is being removed for products that fall within Amazon's enhanced safety categories.

Second, sellers whose businesses are headquartered in Mainland China will be required to obtain new policies and future renewals through the Amazon Insurance Accelerator, Amazon's insurance marketplace operated with Marsh.

The distinction is important.

The rules are based on the seller's business headquarters—not simply where its products are manufactured. A U.S.-based brand sourcing products from factories in China, for example, would not automatically become subject to the Mainland China insurance-provider requirement.

The changes also matter for low-volume sellers because the absence of a sales threshold means an ASIN can create insurance obligations even when its sales are minimal.

2. Why the $10,000 Insurance Threshold Is Disappearing

Historically, sellers generally had more flexibility before exceeding $10,000 in gross monthly proceeds.

That buffer is being removed for sellers with ASINs in Amazon's enhanced safety categories — as this creates a new financial calculation for small brands, wholesalers, and sellers with slow-moving inventory.

Insurance can represent a meaningful fixed annual expense. If a seller generates only limited revenue from an affected product, the policy premium can consume a disproportionate amount of the product's contribution margin.

For example, consider a seller generating only $15,000 annually from affected ASINs while paying a $1,800 annual insurance premium.

That premium alone represents: $1,800 ÷ $15,000 = 12% of annual revenue

The actual profitability impact could be considerably higher after Amazon fees, advertising, fulfilment, returns, and product costs are included.

This means sellers should not automatically assume that keeping every low-volume ASIN active is the most profitable decision.

For some products, delisting or discontinuing an unprofitable ASIN may make more financial sense than maintaining inventory solely to keep the listing active.

3. What Mainland China Sellers Need to Know

One of the most important changes concerns sellers whose businesses are headquartered in Mainland China. Amazon requires these sellers to purchase new liability insurance policies and renewals through the Amazon Insurance Accelerator, a vetted insurance marketplace partnered with Marsh.

However, sellers should pay close attention to the wording.

Headquarters matter—not manufacturing location

A business headquartered in the United States that manufactures products through Chinese suppliers is not automatically considered a Mainland China seller for this requirement.

Therefore, sellers should determine which legal entity is actually registered as the seller on Amazon and where that business is headquartered.

This distinction can prevent unnecessary changes to an otherwise compliant insurance arrangement.

4. Which 11 Product Categories Are Affected?

Amazon's enhanced safety categories cover products where safety and liability concerns can be particularly significant.

The categories identified in the update include:

• General household devices — air fryers, blenders, and similar products
• Lithium battery products — power banks, e-bikes, and related products
• Personal safety equipment — helmets, harnesses, and similar equipment
• Transport-related products — automotive and motorcycle tires
• Sleep products — mattresses, bed rails, and related products
• Outdoor power and heating equipment — generators and similar equipment
• Home medical devices — walkers and respiratory supplies
• Fire-related products — smoke alarms and extinguishers
• Water and marine safety products — life jackets and related equipment
• Children's products — toys, car seats, and similar products
• Consumable and ingestible products — supplements, cosmetics, and related products

If your catalog contains an affected ASIN, do not assume that low sales volume or inactivity eliminates the insurance requirement.

5. Amazon Liability Insurance Compliance Checklist

Before submitting or renewing your Certificate of Insurance (COI), verify that the policy meets Amazon's requirements.

Coverage Type

The policy should provide commercial general liability, excess liability, or umbrella liability coverage.

Minimum Limits

Coverage should provide at least:

• $1 million per occurrence
• $1 million aggregate

Deductible

The deductible must not exceed $10,000.

Occurrence-Based Coverage

Amazon requires occurrence-based coverage applicable to the products sold through the marketplace.

Additional Insured

The policy must explicitly name: "Amazon.com Services LLC and its affiliates and assignees"

Exact Legal-Entity Match

The insured name on the certificate must match the legal entity associated with your Seller Central account. Even small naming discrepancies can create verification problems.

Claims Handling

The insurance carrier must have appropriate worldwide claims-handling capabilities. Sellers should review these requirements before their existing policy expires rather than waiting for Amazon to flag a compliance issue.

6. How GrowithAmazon Can Protect Seller Margins

Insurance compliance should not be treated separately from profitability.

• Catalog audits for enhanced safety ASINs
• Insurance requirement reviews
• COI compliance checks
• Legal-entity and insured-name verification
• Annual premium impact analysis
• SKU-level margin calculations
• Break-even analysis
• Low-margin ASIN reviews
• Strategic delisting recommendations

The goal is simple: Maintain Amazon compliance without unnecessarily sacrificing profitability. For a seller with hundreds of ASINs, identifying which products actually justify their insurance and operating costs can be just as important as obtaining the policy itself.

7. What Sellers Should Do Before November 2?

Sellers should begin preparing before the updated requirements take effect.

1. Audit Your Catalog

Identify every ASIN that falls within Amazon's enhanced safety categories—including dormant or low-volume listings.

2. Review Your Insurance

Check whether your current policy satisfies Amazon's coverage limits, deductible, occurrence-based requirements, additional-insured language, and other conditions.

3. Confirm Your Business Headquarters

Mainland China sellers should verify whether they are required to obtain or renew coverage through the Amazon Insurance Accelerator.

4. Calculate the Financial Impact

Compare your expected annual premium against the revenue and contribution margin generated by affected ASINs.

5. Check Your COI

Make sure the legal entity name and Amazon additional-insured language are correct before submission.

6. Evaluate Low-Volume Products

If an ASIN generates insufficient contribution to justify its insurance and operating costs, determine whether continuing to sell it makes financial sense.

Conclusion

Amazon's November 2, 2026 liability insurance update changes the economics of selling products in enhanced safety categories.

The removal of the $10,000 monthly sales threshold means sellers can no longer assume that low sales volume protects them from insurance requirements. Mainland China sellers also face additional restrictions on where they obtain new policies and renewals.

The best response is proactive:

• Audit affected ASINs
• Review your insurance policy
• Verify your COI
• Confirm your legal-entity details
• Calculate premium impact
• Reassess low-margin listings

For Amazon sellers, insurance is no longer just a compliance checkbox. It is another operating cost that needs to be incorporated into SKU-level profitability and catalog strategy.