Is Commercial Insurance for E-Commerce Business Necessary?

E-commerce businesses do not have the risks of slip and fall incidents and damage to commercial buildings. Still, they may have to face some risks that offline businesses may rarely have to deal with, including stolen inventory, data breaches, damage to products in transit, etc. Commercial insurance is crucial for them to ensure their business continuity and stability.

Types of Commercial Insurance that E-Commerce Businesses Need

  1. General Liability Insurance
    It will protect you if your business is found liable for causing injuries or property damage to third parties.It covers the following incidents:

    • If a delivery driver visits your warehouse to drop a shipment and slips over a broken stair, injuring their leg/arm, it covers their medical expenses and hospital stays.
    • If your delivery person accidentally knocks over a box, breaking all the supplies in it, it covers the cost of repair or replacement of the damaged product.
    • If your business is sued for causing physical injury, property damage, and advertising injury, it covers your legal expenses, attorney fees, and settlement costs.
  2. Property Insurance

    You need property insurance if you own, rent, or lease a physical space for your online business. For example, if you lease a warehouse to store your inventories, you are liable to protect them.

    It covers:

    • Damage or loss to your building and its contents, such as tools, equipment, inventory, computers, signs, etc.
    • Repair or replacement costs to your personal property used for business operations.
  3. Business Income Insurance

    It reimburses lost income and other expenses if you cannot resume your business operations due to a loss or damage caused by a covered peril, such as fire, theft, vandalism, flood, lightning, etc.

    It pays for:

    • Rents
    • Loans
    • Employee wages
    • Cost of operating a temporary warehouse
  4. Professional Liability Insurance

    Also known as errors & omissions insurance, it protects your business from mistakes you commit in the services provided to a client or customer.

    It covers claims resulting from:

    • Incorrect advice
    • Misrepresentation
    • Negligence
    • Personal injuries, such as slander, privacy violations, or libel
    • Missed delivery date
    • Breach of contract
    • Copyright infringement
  5. Cyber Liability Insurance

    Online businesses are increasingly prone to data breaches. You need cyber liability insurance if your business handles customers’ private information, bank account data, Social Security Numbers, and driver’s license numbers.

    It covers the costs associated with a data or cybersecurity breach:

    • Credit monitoring
    • Notifying customers about the incident
    • Recovering lost data
    • Public relations to improve your reputation
  6. Product Liability Insurance

    Product liability insurance is necessary if you design, sell, or distribute products to businesses or customers.

    It covers your product-related risks:

    • Defects
    • Improper labels
    • Injuries or property damage caused by your product
    • Missed product warnings
  7. Workers Compensation Insurance

    It protects your employees from related liabilities and lawsuits after a workplace injury/illness and your business. It covers your employees’:

    • Medical bills
    • Disability expenses
    • Lost wages
    • Ongoing care costs
    • Death benefits (in fatal incidents)

These commercial insurance policies, allow you to run your e-commerce business peacefully without worrying about potential claims and lawsuits.

Grow Your E-Commerce Business Beyond Risks with J Archer Insurance

At J. Archer Insurance Group, we offer all-inclusive commercial insurance that helps your e-commerce business stay ahead of risks. Contact us today to customize your commercial insurance according to your business-specific needs.

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