Selling on Etsy can be a wonderful way to showcase your handcrafted items and earn from them, but it comes with unique challenges. This is why we’ve introduced a new coverage program tailored for Etsy businesses and designed to protect your online business from any risks it may face. Here’s everything you need to know about our insurance for Etsy sellers and how you can use it to navigate the e-commerce industry.
The Etsy seller industry is a vibrant ecosystem where artisans, creators, and small business owners worldwide showcase their unique products. With around 90 million shoppers worldwide, Etsy offers a platform for buyers seeking handcrafted, artisanal, and vintage items with a personal touch.
Etsy finished 2024 with approximately 8.1 million active sellers and its consolidated Gross Merchandise Sales (GMS), which includes other marketplaces like Depop and Reverb, was around $12.6 billion. While the number of active sellers saw a slight decline from the previous year of more than 9 million, the platform continued to generate substantial sales, with its total revenue reaching a record high for the year.
Why is Insurance for Etsy Sellers Important?
Etsy Sellers can use insurance to protect themselves from various risks, streamline their operations, and build credibility within the industry.
Product Liability Protection
Insurance plays a crucial role in safeguarding your Etsy store from any potential financial losses that arise from product liability claims. For instance, if a customer alleges that a product purchased from your Etsy shop caused them harm or injury, product liability insurance can cover settlements, medical payments, and any other associated costs.
Legal Security
Navigating potential legal disputes can be a challenge for Etsy business owners, as it can be both time-consuming and financially taxing. A good coverage policy acts as a safety net for your business, allowing you to carry out business activities without worrying about legal expenses or ramifications.
Risk Mitigation
A comprehensive insurance policy helps you mitigate the risks involved in running your Etsy store by offering financial protection against unforeseen events, such as shipping delays, product defects, and liability claims. With insurance coverage in place, you can focus on your core creative pursuits and customer interactions without the constant worry of financial loss.
Customer Trust and Loyalty
The presence of insurance has a profound impact on building and maintaining customer trust and loyalty. Insurance coverage demonstrates your dedication to your Etsy store and the product you’re selling. It reassures customers that you are an authentic business with a high level of professionalism and accountability.
Etsy Seller Insurance Coverage & Policies
These coverages form the foundation of any risk management program for Etsy sellers:
General liability insurance covers claims of bodily injury, property damage, and personal or advertising injury. Etsy sellers may have customers visit their workshop or attend craft fairs, so this policy can protect against potential lawsuits resulting from injuries or damage. Additionally, it can cover claims related to the advertising of their products.
Cyber liability insurance protects against damages stemming from cyber threats or data breaches. Even if Etsy provides a secure platform, sellers may collect customer information through other means, like email newsletters or custom orders. This policy ensures they’re protected if this sensitive data gets compromised.
Workers’ compensation provides benefits to employees injured while working. If an Etsy seller hires staff to help craft items, pack products, or manage other business tasks, this coverage is crucial. In many places, it’s also legally mandated once a business has a certain number of employees
EPL insurance covers businesses against claims by workers that their legal rights as employees have been violated. As Etsy sellers grow and possibly hire more staff, this coverage becomes more relevant, protecting against potential claims of wrongful termination, discrimination, or other employment-related issues.
Product liability insurance protects businesses from claims tied to product defects that might cause injury or harm. For Etsy sellers, even the most meticulously crafted product could have unforeseen issues. This policy would protect against lawsuits or claims if a sold item causes harm to a buyer.
Commercial Property insurance protects against damage to business-owned assets, such as tools, inventory, or equipment. Etsy sellers, especially those working from home or a specific workshop, need this to safeguard their crafting supplies and finished products from risks like fires, theft, or natural disasters.
Transit and transportation insurance covers goods when they’re being moved from one place to another. Given that Etsy sellers ship products worldwide, this insurance offers peace of mind, ensuring they’re protected against potential losses or damages their products might face while in transit.
At Founder Shield, we understand that each seller has unique circumstances and, therefore, unique business insurance needs. This is why we offer a tailored insurance plan that meets your business requirements.
The cost of your insurance coverage will vary depending on the type of coverage you choose, the size of your business, your financial situation, and your risk exposure. So whether you’re a small business owner or an established company, we will tailor your costs to match your budget.
Etsy Seller Claims & Examples
Navigating a commercial insurance claim is often challenging, often fraught with confusion and multiple unknown factors. The following four-part series outlines the ins and outs of commercial insurance claims:
While Etsy itself doesn’t mandate insurance for all its sellers, some categories of items might require proof of insurance before you can list them. Additionally, certain local laws and regulations may necessitate insurance for businesses operating from home or selling particular products. Even if not strictly required, insurance provides a safety net against unforeseen business risks and potential liabilities.
The amount of Etsy insurance you need depends on various factors, including the nature of the products you sell, the volume of your sales, where you operate, and the potential risks associated with your business. It’s advisable to assess the potential financial impact of a worst-case scenario, such as a significant product liability claim, and ensure your coverage limits can handle such situations. Consulting with an insurance expert can also provide guidance tailored to your unique situation.
To obtain Etsy business insurance, reach out to insurance companies or brokers specializing in business insurance or e-commerce coverage. They can guide you through the process, present multiple options, and help you understand each policy’s details. Be prepared to provide information about your business operations, products, sales volume, and any previous claims to get an accurate insurance quote.
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Finding Etsy seller insurance coverage doesn’t have to be painful. We aim to make the purchasing experience as streamlined and intuitive as possible.
1
Get a quote
Use our custom-built digital platform to get quotes fast. We automate clerical tasks that plague traditional insurance brokerages, giving us more time to be responsive and alert to your company’s needs.
2
Pair with a specialist
No two organizations are the same. Our team of coverage experts partners with your team to engineer your risk management strategy, together. We take the time to understand the intricacies of your company to get you the best possible coverage.
3
Stay one step ahead
To do better, you need to know better. With changing political, technological, legal, and economic landscapes, staying ahead of the curve is critical.
Our in-house team is tapped into the latest developments in your industry, proactively ensuring you’re covered.
Schedule Time with an Etsy Seller Expert
Risk Calibration
Let’s figure out if you’re under- or over-insured and whether your current policies have detrimental gaps.
Identify Cost Savings
We’ll compare your current policies with our extensive benchmarking database to see if your risk and costs have kept pace.
Risk Calibration
Walk away with a detailed plan to manage risk as your company scales — no strings attached.
Why Choose Founder Shield?
Founder Shield is a leading insurance provider that specializes in offering comprehensive coverage for Etsy sellers, offering numerous benefits and advantages over traditional insurance providers. Here’s a breakdown of some of the key features and benefits that you’ll enjoy with us:
Benefits of Choosing Founder Shield
Industry Expertise
Founder Shield is focused on protecting rapidly evolving Etsy startups. We ensure that our products are tailored to meet the unique needs of Etsy sellers.
Customized Solutions
Founder Shield offers bespoke insurance policies that are designed specifically for each client’s needs, ensuring comprehensive coverage that addresses the unique risks associated with Etsy operations.
Fast Quotes
With Founder Shield’s streamlined quoting process, you can receive a personalized quote for your Etsy seller insurance quickly, allowing you to make informed decisions fast.
Ease of Use
Founder Shield’s user-friendly digital platform makes it easy to manage your insurance policies, submit claims, and access important documents whenever you need them.
Dedicated Support
Founder Shield provides exceptional customer service, with dedicated account managers who are always available to assist you with any questions or concerns you may have about your insurance coverage.
Scalable Coverage
As your business grows, Founder Shield’s insurance policies can grow with you, ensuring you always have the right level of coverage for your changing needs.
Founder Shield is a preferred choice for Etsy businesses because of our specialization in the industry. We offer flexible and customized insurance policies, a speedy quoting process, and exceptional customer service with dedicated account managers.
Great service – proactive, responsive, go beyond what I have expected from previous providers. The team do a wonderful job
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info@foundershield.com 
28 Liberty Street, New York, NY 10005 
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Amit Patel
