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Business Insurance for E-commerce

The need for e-commerce insurance has been on a meteoric rise over the past decade, driven by the rapid expansion of the e-commerce industry. As of 2021, the global e-commerce market size was valued at USD 11.20 trillion and is expected to grow at a compound annual growth rate (CAGR) of 14.7% from 2022 to 2028. Because of its impressive growth, the e-commerce industry faces several challenges, including data security, privacy, and logistical difficulties in delivery and returns, hence the need for e-commerce business insurance.

Ecommerce Business Insurance

Risks in the E-Commerce Industry

Risks in the E-Commerce Industry

Science

Cyber Threats

With the rise of cybercrime rates, e-commerce businesses are prime targets for hackers due to the vast amount of sensitive customer data they handle. The costs associated with data breaches and cyber-attacks could be astronomical, not to mention customer notifications, credit monitoring services, and legal fees.

Regulatory Risk

Compliance Issues

E-commerce businesses must comply with various regulations, such as data privacy laws and financial constraints. Failure to comply with these regulations can lead to fines, penalties, and other legal consequences.

Clinical Trials

Business Interruptions

Whether due to outages or supply chain issues, e-commerce businesses could experience severe financial losses if something disrupts normal business operations. Mitigating this exposure typically takes several forms, but leaders must address it nonetheless. 

Patent

Legal Liability

If a product sold by an online store causes harm or injury to a customer, the e-commerce business could be held responsible for lawsuits and financial losses. Third-party bodily injury or property damage remain ongoing risks for e-commerce operations.

E-Commerce Risk Management Guides

At Founder Shield, we offer insurance coverage for various e-commerce operations, focusing on a variety of risks including:

Etsy

Etsy Seller

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Ebay

eBay Seller

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Shopify

Shopify

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Amazon

Amazon Business

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DTC Seller

DTC Seller

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Subscription Box

Subscription Box

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E-Commerce Insurance Coverage & Policies

E-commerce businesses face a wide range of risks, from cyberattacks to product liability lawsuits. Insurance can help e-commerce businesses mitigate these risks and protect their bottom line. These coverages form the foundation of any risk management program for e-commerce companies:

general liability

General Liability Insurance

Although e-commerce companies function mainly online, rarely having brick-and-mortar locations aside from headquarters, general liability risks exist. As a result, general liability provides a broad range of protection against some of the most fundamental risks companies face. Many peg this policy as “all-risk” coverage, benefitting e-commerce companies regardless of physical location. After all, general liability covers personal or property damage and bodily injury occurring on the business premises.

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Although e-commerce companies function mainly online, rarely having brick-and-mortar locations aside from headquarters, general liability risks exist. As a result, general liability provides a broad range of protection against some of the most fundamental risks companies face. Many peg this policy as “all-risk” coverage, benefitting e-commerce companies regardless of physical location. After all, general liability covers personal or property damage and bodily injury occurring on the business premises.

workers compensation

Workers’ Compensation Insurance

Employers are typically responsible for medical costs and lost wages when employees sustain work-related injuries. Furthermore, most states require this particular coverage to protect employees. Work-related injuries and illness expenses can occur even in the world of technology. This policy covers these expenses, protecting employees while keeping e-commerce companies running smoothly.

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Employers are typically responsible for medical costs and lost wages when employees sustain work-related injuries. Furthermore, most states require this particular coverage to protect employees. Work-related injuries and illness expenses can occur even in the world of technology. This policy covers these expenses, protecting employees while keeping e-commerce companies running smoothly.

cyber insurance

Cyber Liability Insurance

E-commerce companies gather, handle, and store mass amounts of personal data. Cyber insurance protects e-commerce companies from third-party lawsuits relating to electronic activities (i.e., phishing scams, ransomware, data breaches, etc.). Plus, it offers many recovery benefits, supporting data restoration and reimbursement for income lost and payroll spent. Unfortunately, cyberattacks have increased significantly since the global pandemic, forcing e-commerce companies to improve cybersecurity measures and practice more due diligence regarding data protection.  

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E-commerce companies gather, handle, and store mass amounts of personal data. Cyber insurance protects e-commerce companies from third-party lawsuits relating to electronic activities (i.e., phishing scams, ransomware, data breaches, etc.). Plus, it offers many recovery benefits, supporting data restoration and reimbursement for income lost and payroll spent. Unfortunately, cyberattacks have increased significantly since the global pandemic, forcing e-commerce companies to improve cybersecurity measures and practice more due diligence regarding data protection.  

Employment Practices Liability Insurance

Any company with employees faces the risks of employment-related allegations, such as discrimination, wrongful termination, breach of contract, etc. Naturally, e-commerce companies aren’t exempt from these types of lawsuits. The reality is that many e-commerce employees work remotely, sometimes blurring the lines of liability. Fortunately, employment practices (EPL) liability insurance responds to claims alleging employers have violated their workers’ employment rights.

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Any company with employees faces the risks of employment-related allegations, such as discrimination, wrongful termination, breach of contract, etc. Naturally, e-commerce companies aren’t exempt from these types of lawsuits. The reality is that many e-commerce employees work remotely, sometimes blurring the lines of liability. Fortunately, employment practices (EPL) liability insurance responds to claims alleging employers have violated their workers’ employment rights.

E-Commerce Specific Coverage

E-commerce insurance is a specialized form of business protection designed to safeguard online businesses from specific risks associated with conducting online transactions and operations. The unique threats e-commerce businesses face necessitate such a dedicated form of insurance.

Product Liability Insurance

Product liability insurance covers e-commerce companies from financial losses from lawsuits alleging that their products caused bodily injury or property damage. This type of insurance is essential for e-commerce companies because it can protect them from catastrophic financial losses. Even if an e-commerce company takes all reasonable precautions to ensure the safety of its products, there is always a risk that a product could become defective and cause harm. Product liability insurance can help e-commerce companies pay for the costs of defending against lawsuits and any damages that may be awarded to plaintiffs.

Product Liability Insurance

Product liability insurance covers e-commerce companies from financial losses from lawsuits alleging that their products caused bodily injury or property damage. This type of insurance is essential for e-commerce companies because it can protect them from catastrophic financial losses. Even if an e-commerce company takes all reasonable precautions to ensure the safety of its products, there is always a risk that a product could become defective and cause harm. Product liability insurance can help e-commerce companies pay for the costs of defending against lawsuits and any damages that may be awarded to plaintiffs.

property insurance

Property Damage Insurance

People often think of brick-and-mortar operations when on the subject of property protection. Still, although e-commerce companies sometimes have little real estate, like an online store or office spaces in multiple locations, they frequently invest in top-notch equipment to achieve their digital goals. For example, if company property is damaged or ruined in a fire or even a burglary, commercial property insurance responds. This policy reimburses e-commerce companies for direct property losses, supporting recovery and momentum.

Property Insurance

People often think of brick-and-mortar operations when on the subject of property protection. Still, although e-commerce companies sometimes have little real estate, like an online store or office spaces in multiple locations, they frequently invest in top-notch equipment to achieve their digital goals. For example, if company property is damaged or ruined in a fire or even a burglary, commercial property insurance responds. This policy reimburses e-commerce companies for direct property losses, supporting recovery and momentum.

transit insurance

Transit & Transportation Insurance

Transit and transportation insurance covers e-commerce companies from financial losses resulting from the loss or damage of products while they are being shipped. E-commerce companies rely on shipping carriers to deliver their products to customers. However, shipping carriers can lose or damage packages for various reasons, such as accidents, weather events, and theft. Transit and transportation insurance can help e-commerce companies reimburse their customers for lost or damaged packages and replace lost or damaged inventory.

Transit & Transportation Insurance

Transit and transportation insurance covers e-commerce companies from financial losses resulting from the loss or damage of products while they are being shipped. E-commerce companies rely on shipping carriers to deliver their products to customers. However, shipping carriers can lose or damage packages for various reasons, such as accidents, weather events, and theft. Transit and transportation insurance can help e-commerce companies reimburse their customers for lost or damaged packages and replace lost or damaged inventory.

Tailored for the Needs of E-Commerce Companies

Founder Shield offers a range of insurance coverage options specifically for online businesses, tailored to meet the needs of e-commerce companies. Each coverage option is designed to provide comprehensive protection against the unique risks e-commerce businesses face. Whether you’re just starting or a more established company, our policies are built to scale with you and ensure that you’re always protected.

Ecommerce Insights

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Why Choose
Founder Shield?

At Founder Shield, we’re dedicated to helping Ecommerce companies succeed by providing comprehensive insurance coverage and exceptional customer service. Here are just a few reasons why our clients trust us to make insurance solutions that protect their companies

1
Experienced Council

 Founder Shield is focused on protecting rapidly evolving e-commerce companies. We ensure that our products are tailored to meet the unique needs of online businesses.

2
Fast Quotes

With Founder Shield’s streamlined quoting process, you can receive a personalized quote for your e-commerce insurance quickly, allowing you to make informed decisions quickly.

3
Scalable Protection

As your e-commerce business grows, Founder Shield’s insurance policies can grow with you, ensuring you always have the right level of coverage for your changing needs.

Get A Quote For E-commerce Insurance

Don’t wait until it’s too late to protect your E-Commerce company. Get an E-commerce insurance quote today and see how Founder Shield can help you mitigate your risks and protect your company’s future.