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Why do Shopify sellers need insurance?
Though Shopify doesn't require you to carry insurance, selling on the platform exposes you to risk. Business insurance can pay for your legal costs if you're sued by a customer, inventory losses after a fire or storm, and recovery costs in the event of a data breach.
Find the right coverage
Insureon helps Shopify sellers find policies that match their unique risks and requirements. Fill out a free application to compare quotes from top-rated insurance companies.
Got questions? Our insurance agents will help you every step of the way.
What types of business insurance do Shopify sellers need?
These insurance policies protect against the most common risks of selling on the e-commerce platform Shopify.
Business owner's policy
A business owner's policy, or BOP, is an insurance package that bundles general liability coverage and commercial property insurance at a discount.
BEST FOR
- Product liability lawsuits
- Damaged or stolen inventory
- Business interruption coverage
General liability insurance
This policy covers common third-party lawsuits, such as slip-and-fall accidents. It typically includes product liability insurance for financial protection against harm caused by your products.
BEST FOR
- Customer bodily injuries
- Product liability claims
- Copyright infringement
Workers’ compensation insurance
Most states require workers' comp for Shopify stores that have employees. It also protects sole proprietors from work-related injury costs that health insurance might deny.
BEST FOR
- Employee medical expenses
- Disability benefits
- Legal fees from worker injuries
Cyber insurance
This policy helps Shopify sellers recover from data breaches and cyberattacks. It’s sometimes called cyber liability insurance or cybersecurity insurance.
BEST FOR
- Customer notification expenses
- Fraud monitoring services
- Ransoms from cyber threats
Commercial umbrella insurance
Umbrella insurance boosts coverage on a Shopify seller's general liability, employer’s liability, or commercial auto insurance policy once the limit is reached on a claim.
BEST FOR
- Customer injury lawsuits
- Property damage lawsuits
- Auto accident lawsuits
Commercial auto insurance
Most states require commercial auto insurance for business-owned vehicles. This policy covers accidents involving a Shopify seller's delivery van or other vehicle.
BEST FOR
- Injuries caused to another person
- Property damage caused by your vehicle
- Vehicle theft and vandalism
Looking for different coverage? See more policies.
How much does Shopify seller insurance cost?
Shopify sellers who work independently can expect to pay less for insurance than larger online stores with employees.
Factors that affect the cost of insurance include:
How do I get insurance for Shopify sellers?
It's easy to get Shopify insurance and e-commerce business insurance if you have the relevant details on hand. Our application will ask for basic facts, such as revenue and number of employees. You can buy a policy online and get a certificate of insurance with Insureon in three easy steps:
- Complete a free online application.
- Compare insurance quotes and choose a policy.
- Pay for your policy and download a certificate.
Insureon's licensed agents work with top-rated U.S. providers to find the right insurance coverage for your business needs, whether you're a sole proprietor or hire employees. Get insured today and find peace of mind knowing your business can survive the unexpected.
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FAQs about Shopify insurance for sellers
Review answers to common questions about Shopify business insurance.
Is product liability insurance required for Shopify sellers?
Though it's not required by Shopify, sellers should carry product liability insurance for financial protection against lawsuits related to their products.
If one of your products injures a customer or damages their property, your business could be held responsible. That could lead to costly attorney's fees, a settlement, or a court-ordered judgment—even if you weren't responsible for the product defect that caused the harm.
Product liability insurance helps cover all of these costs. It's recommended for retailers, manufacturers, and wholesalers, as any business in the supply chain can be held liable for a faulty product.
Examples of product liability lawsuits include:
- Design defects, such as a top-heavy bookcase that tips over and injures a child
- Manufacturer defects, such as a loose screw on a wall-mounted TV cabinet
- Marketing defects, such as improper assembly instructions that lead to an injury
A general liability insurance policy, also called public liability insurance, usually includes product liability insurance. You might also want to consider product recall insurance to protect against costly product recalls. In addition to carrying coverage, it's important to manage your risks to avoid a lawsuit and keep your premium low.
Does Shopify seller insurance protect against theft?
There are a couple types of commercial crime insurance that help e-commerce stores recover from theft and other property losses. Because homeowner's insurance won't provide coverage for business-related losses, it's important to cover your bases.
You should consider:
- Commercial property insurance: This policy covers stolen and damaged inventory and other business property at your main business location (not off-site locations). You can often bundle this coverage with general liability insurance in a BOP for savings. Some insurance companies call it business hazard insurance.
- Fidelity bond: A fidelity bond reimburses you or your customers in the event of employee theft. That includes illegal electronic funds transfers and forged signatures. It's sometimes called employee dishonesty coverage.
Shopify offers Shopify Protect for sellers, which protects against fraud. Installing a security system, bright lighting, and other measures can help you prevent theft. Some insurers even offer a discount when you follow their recommendations for improved security.
What other business insurance policies should Shopify sellers consider?
To fully protect your online business, you may need additional types of coverage. Consider the following policies for financial protection against other business risks:
- Business interruption insurance: Also called business income insurance, this add-on to commercial property insurance helps online retailers recover lost income from a closure tied to a fire, storm, or other covered property claim.
- Equipment breakdown coverage: This policy protects your computers, electrical systems, production machinery, and other equipment from sudden malfunctions. It covers financial losses from short circuits, loss of air pressure or vacuum, or power surges that commercial property insurance typically excludes.
- Electronic data processing (EDP) insurance: This covers electronic data processing equipment, such as computers and POS systems, against data loss during a power surge, fire, natural disaster, or similar incident.
- Inland marine insurance: Inland marine insurance covers inventory kept at storage units, warehouses, and other off-site locations, along with products in transit.
Small business owners who sell online can often add endorsements to a BOP for a discount. Learn about other ways that Shopify sellers can save money on business insurance.