Amazon Seller Insurance Requirements: The $1M PLI Rule Explained

Amazon's Business Solutions Agreement requires sellers generating over $10,000 in monthly sales for three consecutive months to maintain Commercial General Liability (CGL) insurance with a minimum $1,000,000 per occurrence and $2,000,000 aggregate coverage.

The policy must: (1) name Amazon.com Services LLC and its affiliates as additional insureds, (2) be placed with an insurer rated A- or better by AM Best, (3) be a US-admitted policy (not an offshore or non-admitted policy), and (4) cover your products as sold on Amazon specifically.

You must submit a Certificate of Insurance (COI) to Amazon via Seller Central within 30 days of receiving the requirement notice. Failure to comply can result in account suspension.

Important: the $10,000 monthly threshold is a trigger, but Amazon can also request proof of insurance at any time for sellers below this threshold, particularly in high-liability categories (electronics, children's products, food supplements, medical devices).

When Amazon is named as an additional insured on your policy, Amazon can make claims directly against your insurer if a customer sues Amazon over your product — without Amazon having to first prove you were liable.

This is significant protection for Amazon but also for you: it gives Amazon a reason to defend you in joint lawsuits rather than pointing all blame at the third-party seller. Without this coverage, Amazon can indemnify itself from its contract with you and leave you fully exposed.

The additional insured endorsement must be specifically worded for Amazon. Many standard CGL policies do not automatically include this. You must request it from your insurer explicitly, and the COI must reflect the endorsement.

Amazon has partnered with several insurers through its "Amazon Insurance Accelerator" program that offer pre-vetted policies at competitive rates. Approved providers (as of 2024) include: Markel Insurance, Next Insurance, Coalition, Embroker, and several others accessible through the Seller Central insurance dashboard.

These providers understand the Amazon COI requirements and can issue compliant certificates faster than traditional brokers. Policies through these providers are typically $300–$1,200/year for most product categories and revenue levels.

For Taiwan-based sellers: you must purchase a US-admitted policy. Your Taiwan business insurance does not satisfy Amazon's requirement. The insurers above all write policies for foreign sellers operating through US entities — you will need a US EIN and US business address (your LLC or registered agent address is sufficient).

In Seller Central, go to Settings > Account Info > Seller's Insurance. Upload your Certificate of Insurance (ACORD 25 form is standard). The COI must show: your business name as the named insured, Amazon.com Services LLC as additional insured, coverage limits meeting the requirement, policy effective and expiration dates, and your insurer's contact information.

Amazon's compliance team reviews COIs within 3–7 business days. Common rejection reasons: additional insured language does not specifically name Amazon, coverage period has already expired, policy limits stated per-aggregate only (must show per-occurrence), or insurer AM Best rating not listed.

Renew your policy and re-upload the COI before expiration — Amazon monitors policy expiration dates and will send suspension warnings if your coverage lapses.

CGL / PLI covers bodily injury and property damage claims arising from your product. If a customer is injured using your product and files a lawsuit, your insurer defends the claim and pays covered damages up to your policy limit.

PLI does not cover: product recalls (that is product recall insurance, a separate line), IP infringement claims, breach of contract with Amazon, or false advertising claims. Consider supplementing with a product recall policy if you are in food, electronics, or children's products.

For Taiwan brands, your product liability exposure is real. The US litigation environment is aggressive, and plaintiff attorneys specifically target foreign manufacturers who may lack US-based assets. Adequate insurance is not optional — it is the cost of doing business in the US market.