What are the insurance requirements for an e-commerce business in my state?
State law asks little of an online seller. It requires workers' comp once you have employees, with a starting point that differs by state, and liability coverage on any vehicle the business owns. Most other requirements come from contracts with a marketplace, a warehouse, a landlord or a lender.
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- Two requirements are statutory: workers' comp once you have employees, and minimum limits on vehicles you own.
- The workers' comp starting point runs from Kansas's $20,000 payroll line to a single employee in New York and Pennsylvania.
- A seller's protection from a product claim can depend on whether the maker can be reached, and importing or selling under your own label can remove it.
What does the law require of an online seller, and what comes from contracts?
The law asks for two things: workers' comp once you have employees, and liability coverage on vehicles the business owns. It also sets a deadline for telling customers about a data breach, which is a duty, not an insurance purchase. Contracts require everything else.
| State | Workers' comp starts | Auto minimum (person / accident / property) | Customer data breach notice |
|---|---|---|---|
| Kansas | Yearly payroll over $20K | $25K / $50K / $25K | Without unreasonable delay |
| Missouri | Five employees, or one in construction; relatives count | $25K / $50K / $25K | Without unreasonable delay |
| New York | One employee | $25K / $50K / $10K | 30 days |
| Pennsylvania | From the first employee | $15K / $30K / $5K | Without unreasonable delay |
| Massachusetts | Even one employee; relatives count | $25K / $50K / $30K | As soon as practicable |
| Louisiana | Any employee; no minimum number | $15K / $30K / $25K | 60 days |
| Maryland | From the first covered employee | $30K / $60K / $15K | 45 days |
| Washington | Every employer with covered workers, through the state fund unless approved to self-insure | $25K / $50K / $10K | 30 days |
As of November 2026; each figure links to its source. Auto limits are the legal minimum for one injured person, all injured people in one accident, and property damage. They are the least the law accepts, not what a serious crash can cost.
Workers' compWorkers' Compensation Insurance that pays medical bills and lost wages when an employee is hurt or sick because of work. Insurers call it workers' compensation. more → pays an employee's medical bills and lost wages after a work injury. Where the trigger is one employee, a part-time packer counts. Whether a helper counts as an employee depends on the state, so read your state's page. For cost, see our workers' comp guide for e-commerce; the state law index compares all eight.
The auto limits apply to a delivery van or pickup the business owns, and business auto coverage has to meet them. A car you or a packer drives on a business errand is not your vehicle. Coverage for that is called hired and non-owned autoHired and Non-Owned Auto Liability coverage for accidents in vehicles your business does not own, such as rentals or an employee's personal car used on a work errand. Insurers call it hired and non-owned auto. more →.
Breach laws protect each state's own residents, so the deadline that applies to you depends on where your customers live. A seller with customers in many states can plan around the shortest one. Cyber liability coverage can help pay for the notices and the response.
What does the law say about a seller that did not make the product?
It depends on the state, and the sections below give the rules that differ. Federal product safety law counts anyone who imports a consumer product as its manufacturer. (Source: 15 U.S.C. §2052)
Product liability coverage pays when something you sold hurts someone or damages their property. Our coverage page explains it. No state of the eight requires it by law. A marketplace's seller agreement can, which is why the contract section comes last.
What does an online seller in Kansas have to carry?
Kansas shields a seller from a product claim only if the maker can be served and a judgment against it would be reasonably certain to be paid. (Source: K.S.A. 60-3306)
A seller that is the maker, or that imports from a maker it cannot reach, can lose that shield. A sole owner with no staff is outside Kansas workers' comp unless the owner elects in.
What does an online seller in Missouri have to carry?
Missouri lets a business whose only role is selling ask to be dismissed from a product claim, with a sworn statement, when the maker or another defendant is in the case and the injured person can recover in full from it. (Source: RSMo 537.762)
The route is for sellers whose liability rests only on selling, so ask counsel before relying on it if you import or label the product yourself.
What does an online seller in New York have to carry?
New York requires any business that owns or licenses a New York resident's computerized private information to keep reasonable safeguards. (Source: N.Y. General Business Law §899-bb)
A small business may scale those safeguards to its size, and the attorney general enforces the rule; the law gives customers no right to sue under it. A seller who stores customer details can ask its agent what its cyber policy responds to.
What does an online seller in Pennsylvania have to carry?
Pennsylvania covers a corporation's officers under workers' comp by default; an officer who wants out has to opt out on two forms.
If you run the business as a corporation with a few packers, ask your agent how the officers are treated on the policy. The Pennsylvania link in the table above explains the opt-out.
What does an online seller in Massachusetts have to carry?
Massachusetts data-security rules apply to all persons that own or license personal information about a Massachusetts resident. (Source: Massachusetts data-security regulation)
That can include an online seller based in another state that holds a Massachusetts customer's details. Ask your agent what your cyber policy covers if a breach reaches those customers.
What does an online seller in Louisiana have to carry?
Louisiana treats a business that labels a product as its own, or holds itself out as the maker, as the manufacturer. (Source: La. R.S. 9:2800.53)
A seller that controls or influences a design or quality trait that causes damage is treated the same way. If you sell under your own label, tell your agent.
What does an online seller in Maryland have to carry?
A 2019 federal appeals court ruling under Maryland law held that a marketplace which only fulfilled an outside seller's product was not that product's seller. (Source: U.S. Court of Appeals, Fourth Circuit)
A 2019 ruling is not the last word. Do not count on a marketplace to absorb a claim, and check that your own policy responds.
What does an online seller in Washington have to carry?
A seller that did not make the product takes on the maker's liability if no solvent maker can be served, or if the product was marketed under the seller's trade or brand name. (Source: RCW 7.72.040)
An importer of goods from an unreachable maker, or a seller of its own brand, can fall in that group.
What will my contracts require regardless of state?
Most of an online seller's insurance requirements sit in contracts, and they apply in every state. Often, your landlord and lender will have specific insurance requirements you must meet to stay in compliance.
A marketplace can ask for a liability policy once your sales pass a level it sets, and each one has its own seller agreement. Our guide to marketplace seller agreements shows how to read yours. A third-party warehouse's liability for your goods can be limited by the storage agreement, and you can ask in writing for a higher limit. (Source: Uniform Commercial Code §7-204, model text)
The card networks' security rules apply to any business that takes card payments, whatever its size. (Source: Payment Card Industry Security Standards Council) A lease usually asks for a certificateCertificate of Insurance (COI) A one-page proof of your coverage, showing the insurer, policy number, and limits, that you hand to a landlord or client. Insurers call it a certificate of insurance. more → naming the landlord; the landlord insurance explainer shows what it must say. If you ship from a second state, adding a location in a new state shows what changes.
Common questions about e-commerce insurance requirements
Often not. A business with no employees generally has nothing to insure, though in some states an owner who is a corporate officer is covered unless they opt out. Whether a helper counts as an employee depends on your state, so read your state's page before you hire.
Not in the eight states this guide covers. A marketplace, a lender or a landlord can ask for product liability coverage, and a lender or a card contract can ask about cyber coverage, so check those contracts.
Yes. Workers' comp and auto rules follow where your staff work and your vehicles are kept, and breach notice follows where the customer lives.
Check what your online store has to carry
Send us your states, your sales channels and any contract that asks for insurance, and we'll sort what comes from the law and what comes from the contract.