What Does Product Liability Insurance Cover?
Product liability insurance covers your business from having to pay the full cost
Whether you design it, build it, or ship it — we protect your business from production-related risks.
Insurance for Etsy sellers is small business liability insurance designed to protect shop owners from claims related to the products they make and sell.
Unlike Amazon, Etsy does not currently require sellers to carry product liability insurance. However, the fine print in their seller protections still leaves you legally responsible if something you sell causes harm. Insurance Canopy offers Etsy insurance for sellers designed to help cover:
(if you sell on Etsy and elsewhere)
Every policy is flexible and tailored to your shop, whether you’re selling handmade goods, vintage treasures, or digital products.
You need Etsy seller insurance if you’re selling physical products online, especially if they could be used, worn, or consumed by others. Types of sellers who benefit most include:
Handmade Sellers
Artists & Crafters
Vintage Collectors & Resellers
Indie Brands
Product Manufacturers
Etsy doesn’t protect you if a customer makes a claim against your shop. That means you’re fully responsible for any injuries, damages, or lawsuits caused by your products. Without your own insurance policy, a single claim could shut down your small business.
Having liability insurance gives you the confidence to keep creating and selling!
✔️ Cover your craft: Insurance helps cover medical bills, legal defense, or settlements if a product harms a customer
✔️ Protect your brand: Lower or eliminate the cost of recalls, product complaints, or lawsuits
✔️ Sell beyond Etsy: Coverage extends to your entire ecommerce business, even if you also sell on Amazon, eBay, Shopify, or at in-person craft fairs
✔️ Peace of mind: Focus on designing, listing, and growing your shop while your insurance has your back
Did you know?
Even if you didn’t manufacture an item (like a vintage resale), you can still be sued as part of the product’s distribution chain.
Most Etsy sellers pay an average of $116/month or less for product liability insurance with Insurance Canopy.
Your price depends on factors like:
Each policy is crafted to your business, so you only pay for what you need!
Etsy insurance for sellers from Insurance Canopy includes key coverages to protect your shop from unexpected claims. It includes $2 million in general and product liability coverage and customizable add-ons tailored to your unique needs.
Included
General Liability Insurance is built to cover third-party injuries or property damage caused by your business activities, like a customer tripping at your craft fair booth or accusing your listing photos of copyright infringement.
Product Liability Insurance is designed to cover claims of injuries or damages caused by the products you sell, even if you didn’t manufacture them. Common examples include jewelry that causes skin reactions, candles that overheat, or toys missing warning labels.
Recommended Add-ons
Product Recall Insurance helps cover the costs of contacting buyers, arranging returns, shipping, and safe disposal. It won’t replace lost revenue, but it can keep a recall from draining your savings. A mislabeled candle scent or a skincare product missing an ingredient warning can mean pulling items from your shop.
Cyber Liability Insurance helps you recover if your shop is hacked, your payment info is stolen, or a phishing attack compromises your account. Coverage can include notifying affected customers, paying for credit monitoring, and hiring public relations professionals to protect your shop’s reputation. Your Etsy shop runs online, which means your customer data is always at risk.
Inland Marine Insurance protects your products while they’re in transit — whether that’s mailing orders to customers, hauling boxes to a craft fair, or storing extra stock in a rented studio or storage unit. Even if you run your Etsy shop from home, your inventory isn’t always sitting safely on a shelf!
If your Etsy shop grows and you bring in more staff, like hiring someone to pour candles, pack orders, or run your booth at a market, Workers Compensation Insurance helps cover medical bills and lost wages if they get injured on the job. Most states require this coverage if you have employees, even part-time.
The Amendment of Coverage Territory endorsement extends your liability protection to claims outside the U.S. Etsy is global, and so are many of your customers. This coverage is perfect if you ship your handmade jewelry to Europe, your art prints to Canada, or your vintage clothing to Australia!
No matter how you craft it, list it, wrap it, or ship it, Insurance Canopy has you back!
✅ Handcrafted coverage for Etsy sellers
✅ Simple and easy online application
✅ Quick, custom quotes within 24 hours
✅ U.S.-based, licensed support team
Thank you so much
Steve MonrealI needed a portable policy as a yoga instructor. I found this company in an online search. Called and got details from them, was quite surprised at how affordable... Read More
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Robert EarnestI am glad I went with them. I needed a last minute policy to cover an event I was doing and they had exactly what I needed at a... Read More
Deloris PachecoVery easy to renew policy
Elyce NissinoffRepresentative Sarah was very helpful. Walked me through every step and not to mention the price even matched the service! Would recommend to any and everyone.
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Masha Rusanovgreat little company, with fair pricing, for entertainers who need occasional coverage.however, they have long hold times to speak to an agent, and their customer service left a little something... Read More
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Chad LaiblyThank you so much
Steve MonrealI needed a portable policy as a yoga instructor. I found this company in an online search. Called and got details from them, was quite surprised at how affordable... Read More
Jamie CalawayVery easy & quick experience. We got insurance in no time with no hassle. Thank you!
Robert EarnestI am glad I went with them. I needed a last minute policy to cover an event I was doing and they had exactly what I needed at a... Read More
Deloris PachecoVery easy to renew policy
Elyce NissinoffRepresentative Sarah was very helpful. Walked me through every step and not to mention the price even matched the service! Would recommend to any and everyone.
queenkiamWould have 5 starts, but not right now. This is the first time I have ever had to pay for an additional insured ever in 20 year's. They either have... Read More
Anthony BurgessVery user friendly platform. Multiple options. Very good pricing. Needed liability insurance in order to secure a very good paying event for my solo tribute show. Was set up within... Read More
Michael RileyNeeded DJ insurance for Memorial Day weekend & was squared away within an hour for 2 events! Highly recommend
Jay SolisWhat a lovely experience I had with Insurance Canopy! Easy and fast sign up, great policy, matches my needs as a self-employed business owner. Highly recommend!
Masha RusanovNo, Etsy does not have insurance for sellers. Etsy does offer the Etsy Seller Protection policy, but this mainly covers disputes like undelivered items or unauthorized transactions.
The seller protections explicitly state they do not cover you if a product you sell causes injury, property damage, or other liability issues. That’s where Etsy seller insurance steps in to protect you, your shop, and your livelihood.
The most important insurance you need to sell on Etsy is product liability insurance! It’s designed to protect you if a customer is hurt or suffers damage from something you sold (like a candle, lotion, or handmade jewelry).
Most sellers bundle this with general liability insurance, which also protects you at craft fairs or in-person events. Depending on your shop, you may also want:
Etsy Seller Protection is free, but it’s limited. It only helps with things like non-delivery claims or certain payment disputes. It does not pay for lawsuits, medical bills, or property damage caused by your products.
For that kind of coverage, you’ll need a separate Etsy seller insurance policy, which typically starts around $116/month through Insurance Canopy.
No, you don’t need insurance to sell handmade crafts online, but it is highly recommended. Even if your craft is safe and simple, accidents can happen to anyone, such as:
Without insurance, you’d be responsible for covering the costs yourself. With insurance, you can keep creating and selling with confidence.
Product liability insurance covers your business from having to pay the full cost
Product liability insurance helps cover claims related to physical damages caused by products
Trying to navigate the roads of product liability insurance can feel like navigating
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Our licensed, U.S.-based agents are here for you from 8 a.m. to 8 p.m. Eastern, Monday through Friday, so they can enjoy evenings and weekends with the people who matter most.
Our licensed, U.S.-based agents are here for you from 8 a.m. to 8 p.m. Eastern, Monday through Friday, so they can enjoy evenings and weekends with the people who matter most.