What are the 4 biggest risks to your e-commerce business?
Door Lou Benders
Posted on 22 June, 2022
Running an e-commerce business is not without risk. While you easily attract many customers through bol.com and Amazon, it also increases your risk of liability. Serving a larger audience and selling more products means more potential for problems. But what could really happen? And is there a chance it will happen to you? Find out the 4 biggest risks to your business and how to insure against them. No matter how big or small your business is.
1. You, your employees or your belongings accidentally break something
Unfortunately, not everything always runs smoothly. Sometimes you knock something over, your employee drops a box or a charger explodes. Oops.
Just like a regular store, you as the owner are liable for damage or injury to others. For example, if you tip coffee over a customer's laptop or an employee gets hurt in your warehouse by a lying object. You are the one who pays for the costs. In other words, your company is liable.
The good news is that you can properly insure yourself against this with a customized business liability insurance policy for e-commerce businesses that insures you in 3 main cases:
- When you or your employees cause damage or injury
- When your products cause damage or injury
- When something happens to your employees during working hours
When your products cause harm or injury
Just like a regular store, as a webshop owner you also want to protect yourself from product liability - as the manufacturer of your products. Whether you sell clothing or electronics. If your products cause damage or injury, you can be held liable.
As a webshop owner, you are also considered a producer under the law if:
- You import products from outside the EU
- You buy products within the EU and resell them under your own brand name
For dropshippers, this is important to know. Even if you know exactly who produced your products, if you resell them under your own brand name, you can be held liable for any damages or injuries. To protect yourself against this, it is best to take out business liability insurance (avb).
When something happens to your employee during working hours
As your business grows, at some point you will need help with marketing, production, delivery or administration. But hiring employees is not without risk. As an employer, you have an obligation to provide a safe environment, even when your employees are working from home, during company outings or when they are on the road for work.
Should something happen to your employee during working hours, you could be held liable. Also, if you as a self-employed person regularly hire other self-employed people, in some cases they are considered employees under the law and you need employer's liability insurance as part of your avb insurance - for a few extra dollars a month.
