Amazon removes its $10,000 US insurance threshold

On 1 November, a parent selling handmade wooden toys on Amazon.com at 300 dollars a month needed no insurance at all.

On 2 November, the same parent, selling the same toys, needed a million dollars of commercial liability cover.

Nothing about the business changed. Nothing about the products changed. Amazon deleted a threshold, and a rule that had always been aimed at substantial sellers landed on everyone.

This is not a warning about something coming. The date has passed.

What it was, and what it is

The before is worth stating carefully, because the headline figure is the part most people are getting wrong.

Before. Amazon required one million dollars of commercial liability cover, per occurrence and in aggregate, from any seller whose gross proceeds from Amazon.com sales exceeded 10,000 dollars in a month. Cross that line and you had 30 days to produce a certificate. Stay under it and the requirement never touched you. For a side business turning a few hundred dollars, it was effectively invisible.

After. In the enhanced safety categories, the same million-dollar cover is required, in Amazon’s own wording, regardless of whether they meet the 10,000 dollar gross proceeds in a month threshold.

So read the change precisely. The million dollars is not new. That figure has been Amazon’s coverage requirement for years, and anyone reporting it as a new obligation has taken the background for the news. What is new is the trigger. The sales floor underneath it has been removed for three categories, and a rule written for businesses of a certain size now applies at any size at all.

Both halves of the coverage figure still matter: per occurrence caps any single claim, in aggregate caps the policy year, and a cheap policy meeting one and not the other does not qualify.

The categories are children’s products, cosmetic and ingestible products, and lithium battery products. Amazon’s phrasing is that the enhanced safety categories include, but are not limited to, those three, so the list is a floor rather than a boundary. A seller whose products sit near any of those definitions should assume they are in scope until Amazon’s category page says otherwise.

It applies to both new and existing listings, in Amazon’s words. There is no grandfathering of the listing itself, only of the policy, which is the next point and the one most likely to save someone money this month.

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The grandfathering clause is the thing to check today

Amazon’s notice contains a provision that a lot of the coverage has skipped over.

If a seller holds a valid third-party policy that meets the coverage requirements and was submitted to Amazon before 2 November, that policy can continue to be used until it expires.

So the operative question for an existing seller is not whether their insurer is on an approved list. It is a documentation question with a date attached: was the certificate submitted to Amazon before 2 November, and when does it expire. If the answer is yes and the expiry is months away, nothing needs buying today, and the decision moves to renewal. If the certificate went in after 2 November, the newer rules apply to it.

The other published requirement worth checking against an existing policy is the deductible. Any deductible cannot exceed 10,000 dollars, and it has to appear on the certificate of insurance. A policy that meets the million-dollar limits but carries a larger excess does not comply, and the certificate is where Amazon reads it.

The mainland China rule, read carefully

There is a second change in the same notice, and its scope needs stating precisely because it is easy to over-read.

Amazon says sellers based in mainland China must now obtain their insurance through the Amazon Insurance Accelerator programme. The next sentence says that from 2 November, Amazon will reject newly submitted insurance policies that are not obtained through the Accelerator.

That second sentence does not name a seller location. It sits inside the paragraph about mainland China sellers, and the natural reading is that it belongs to them. Amazon does not say “only”, and it does not say “everyone”. A seller outside mainland China submitting a new certificate this month will find out which reading Amazon is applying, and the honest position is that the notice does not settle it.

For a European seller the practical consequence is small but real. If you are submitting a fresh certificate rather than relying on one filed before 2 November, allow for the possibility that a policy from your own broker is refused, and do not leave the submission to the week a listing goes live.

Why a fixed cost lands unevenly

The economics here are worth saying plainly, because they explain who actually leaves.

Commercial liability cover is priced on risk and category far more than on revenue. Two sellers in the same children’s category, one turning 500 dollars a month and one turning 50,000, are underwriting roughly the same hazard per unit sold and will be quoted in a similar range. The premium does not scale down to meet a hobby business.

Set that against a 10,000 dollar monthly threshold and the old rule looks like what it was: a crude but functional size filter. It let the smallest sellers list without a fixed annual cost, and it caught them once they were large enough to absorb one. Removing it does not raise anyone’s risk. It transfers a fixed cost onto the population least able to spread it.

The predictable outcome is not that small sellers buy insurance. It is that some of them stop listing in those three categories, and the categories consolidate a little toward sellers who already had cover. Whether that is a safety improvement or a competition loss depends on where you sit, and Amazon has framed it as the former.

We are not publishing a premium figure for this. The one quoted range in circulation was gathered before the change and describes sellers with half a million to a million dollars of revenue, which is precisely not the population the new trigger captures. Quoting it against a 300-dollar-a-month seller would be worse than saying nothing.

What a seller does differently on Monday morning

• Check whether any of your Amazon.com listings sit in children’s products, cosmetics, ingestibles or lithium batteries, including accessories and anything containing a cell. The category list is explicitly not exhaustive, so treat adjacency as inclusion until Amazon’s own category page says otherwise.
• Find the date your current certificate of insurance was submitted to Amazon. Before 2 November means you can run to expiry. After it means the current rules apply now.
• Read the deductible on that certificate. Above 10,000 dollars and it does not comply, whatever the limits say.
• If you need a new policy, confirm the per-occurrence and aggregate limits are both at one million dollars, and allow time for the submission to be accepted rather than assuming it will be.
• If you sell only in European stores, no action. This requirement is written against Amazon.com sales and no other marketplace has been named.

Where the honest uncertainty sits

Amazon has not said whether a similar trigger will follow in other marketplaces, and neither its notice nor its requirements page addresses European stores.

The enhanced safety category list is open-ended by Amazon’s own wording, so a seller cannot read it once and be finished. Membership can change without the rule changing.

And the scope of the Accelerator rejection is genuinely unclear from the notice. The sentence sits under the mainland China paragraph but is written without a location, and Amazon has not clarified which it means.

The three-line version

• If you run the account: find the submission date on your current certificate before buying anything. A policy filed before 2 November runs to expiry, and that is the difference between a renewal conversation and an unbudgeted purchase this week.
• If you have just taken on compliance: the gap to name is that the category list is explicitly not exhaustive, so there is no fixed set of SKUs to check against and the exposure has to be reviewed rather than ticked off.
• If you sign the budget: this is a real cost with no revenue attached, and it falls hardest on your smallest lines. Price it per category rather than per seller, and refuse any quote presented as an Amazon-mandated rate, because Amazon mandates the cover, not the price.

Sources

• Amazon Seller Central, New Commercial Liability Insurance Requirements effective November 2, 2026: https://sellercentral.amazon.com/seller-forums/discussions/t/287d5c33-8278-4802-ba69-2f58f7dda408
• PPC Land: https://ppc.land/amazon-forces-1m-cover-on-small-safety-category-sellers-from-november-2/