6 Insurance Secrets I Learned As An Underwriter For Beauty & Cosmetics Products
Sometimes an underwriter can be like the character The Banker on the TV
888.600.0894
Product liability insurance built for beauty
and skincare brands
Product liability insurance built for beauty and skincare brands
Whether you create, import, distribute, or private label products, you need cosmetic liability insurance. Issues like ingredient mislabeling, contamination, or allergic reactions can result in expensive lawsuits. Even if you didn’t produce the product, you could still face liability if it’s sold under your brand name.
Our policies are tailored to help you fulfill the insurance requirements of retailers and online marketplaces, allowing you to sell your products with confidence in physical stores, e-commerce platforms, and across the supply chain.
Most cosmetic businesses insured through Insurance Canopy pay between $2,000 and $3,000 per year, but your exact rate will depend on several factors specific to your products and business operations.
What Can Affect Your Premium?
Getting insured isn’t just a box to check. It’s the smartest way to protect your brand and grow your business.
Pricing Tiers at a Glance
| Risk Tier | Common Product Types or Scenarios | Typical Premium Average |
|---|---|---|
|
Low Risk |
Handmade soaps, scrubs, lip balms, clean skincare, and low-volume online beauty brands |
$1,200 – $2,000 / year |
|
Moderate Risk |
Indie skincare lines with active ingredients, brands with trade show exposure, multiple product lines |
$2,010 – $4,994 / year |
|
High Risk |
Large operations, high sales volume, added endorsements, or excess coverage requests |
$5,200+ / year |
Common Product Types or Scenarios
Handmade soaps, scrubs, lip balms, clean skincare, and low-volume online beauty brands
Typical Premium Average
$1,200 – $2,000 / year
Common Product Types or Scenarios
Indie skincare lines with active ingredients, brands with trade show exposure, multiple product lines
Typical Premium Average
$2,010 – $4,994 / year
Common Product Types or Scenarios
Large operations, high sales volume, added endorsements, or excess coverage requests
Typical Premium Average
$5,200+ / year
These figures reflect real policyholders covered under our insurance program and align with common underwriting tiers.
Real Pricing from Insurance Canopy Customers
Small-Batch Skincare Line
Annual Premium: $1,396
A handmade skincare business selling natural moisturizers and cleansers through an online store. Low risk and modest revenue kept this policy affordable.
Emerging Indie Beauty Brand
Annual Premium: $3,132
An up-and-coming cosmetic company offering facial oils and eye creams with active ingredients. The business attends trade shows and sells in boutiques, placing it in the moderate risk tier.
High-Volume Clean Beauty Company
Annual Premium: $9,280
A well-established brand offering a wide product line, including CBD topicals. The company sells across multiple states and added vendor endorsements for national retailers.
Businesses love Insurance Canopy because we get the real risks behind cosmetic products. Whether you’re selling retinol serums, botanical hair masks, or private-label lip gloss, we know how one mislabeled ingredient or skin reaction can lead to a lawsuit.
At Insurance Canopy, we offer tailored protection that helps shield your brand from costly claims, so you can focus on creating, launching, and scaling with confidence.
Specialized Coverage for
Cosmetic Products
We don’t offer generic policies. Our coverage focuses on the unique liabilities associated with cosmetics, specifically addressing high-risk ingredients, possible adverse reactions, and FDA labeling regulations.
Meets Retail & Online
Marketplace Requirements
Selling on platforms like Amazon, Etsy, or through national retailers? Our policies provide the limits and documentation you need to fulfill insurance requirements, allowing you to list products promptly and maintain your supply chain.
Fast, Simple, and Customizable
Apply online in just a few minutes, receive a quick quote, and tailor your coverage to meet your specific needs. We make it easy to get insured!
We recommend the following coverages for cosmetic product businesses:
Included Coverages (Standard with Most Policies)
General liability insurance protects your business from third-party risks like injuries and property damage. While it doesn’t cover issues with the product itself, it’s essential if you have a physical store, attend trade shows, or interact with customers in person. It helps cover costs if someone gets hurt or claims your business caused damage.
Product liability insurance protects your business if someone claims that your cosmetics caused bodily harm due to contamination, mislabeling, or an undisclosed ingredient. This is included within the general liability policy, but it addresses claims directly tied to the product itself. Most retailers, vendors, and online marketplaces (like Amazon) require this coverage.
Add-Ons Coverages
Tools and supplies insurance (aka inland marine insurance) covers raw materials, equipment, or finished goods damaged in transit. This is ideal for companies that ship goods, attend markets, or store inventory outside their main facility.
Product recall coverage (sometimes called product withdrawal insurance) helps cover the costs of removing a product from the market when it’s found to be unsafe or defective. This can include expenses like shipping, disposal, and customer notifications if you need to pull a batch due to a labeling error, non-compliant ingredients, or potential contamination.
An excess liability policy provides extra coverage beyond the limits of your base insurance policies. For a cosmetic product business, it helps cover the expense of large lawsuits or claims if the costs exceed what your base insurance covers. It’s added protection for high-risk or fast-growing brands.
Additional insureds (AI) are qualifying individuals or businesses you can add to your insurance policy, ensuring they enjoy the same coverage benefits as you in case of a claim. Retailers, manufacturers, or marketplaces like Amazon may require you to list them as AIs.
Often required by additional insureds, these add-ons are often tied into leases or vendor contracts. They mean your insurance pays first if there’s a claim (Primary/Non-Contributory) and won’t try to recover costs from the other party involved (Waiver of Subrogation). This protects your business partners and helps prevent disputes.
Cyber liability coverage protects your cosmetics business if customer data — like names, addresses, or payment info — is compromised through your website, online store, or email. It covers costs from data breaches, cyberattacks, and possible fines. It’s especially important if you sell beauty products online or store customer information.
Professional liability insurance covers claims related to mistakes or negligence in your professional services. For a cosmetic product business, this applies if you give advice — like giving a customer skincare guidance that results in a reaction. This add-on is ideal if you teach classes, host workshops, or provide consulting.
Employee benefits liability insurance covers mistakes made while managing human resources, such as health insurance, retirement plans, or paid leave. This coverage is recommended if you handle HR in-house and have employees.
Foreign liability reimbursement insurance covers claims that happen outside the U.S. For a cosmetic product business selling internationally, it helps protect you if a customer in another country is harmed by your product and files a claim. This is helpful for international sellers, since standard U.S. policies usually exclude foreign claims.
Hired and Non-Owned Auto (HNOA) insurance covers accidents involving vehicles your business doesn’t own, like rentals or employee cars used for work. It’s useful if you or your team drive to deliver products, attend trade shows, or run errands. If there’s an accident, HNOA helps cover liability costs so your business isn’t held financially responsible.
We work with a wide range of cosmetic product businesses — from solo creators to fast-growing indie brands. Here’s a sample of what we typically cover:
Pro Tip: Our policies also help you meet the insurance requirements of major retail stores and online marketplaces so that you can get your products on shelves and in carts.
1 Additional Insured: $15, Unlimited Additional Insureds: $30
The most your policy will pay for bodily injury and property damage claims occurring within the policy term that you become legally obligated to pay due to your business services.
$2,000,000*
The maximum amount your policy will pay for bodily injury and property damage claims occurring within the policy term that result from the products you use to perform your services. However, it does not cover your products that are sold or distributed.
$2,000,000*
$1,000,000
The maximum amount paid per incident during the term of the policy.
$1,000,000*
Applies to damage by fire to premises rented to the insured and to damage regardless of cause to premises (including contents) occupied by the insured for 7 days or less.
$100,000
An additional cost will be added for this coverage. See the application for additional coverage details for Cyber Liability Insurance.
$100,000
$2,500
*Other limits available on underwriting approval.
Have Questions?
Our non-commissioned, licensed agents are available to answer any questions
you may have!
Monday to Friday, 8 am – 8 pm EST
Se habla español
To apply for insurance with Insurance Canopy:
In the beauty industry, the most common claims typically involve:
General liability insurance covers things like injuries or property damage, while product liability insurance protects against claims related to defects, contamination, or adverse reactions caused by your products. Insurance Canopy’s base coverage includes both, ensuring you’re fully protected from a range of risks in the beauty industry.
Our flexible policies meet the needs of businesses of all sizes, including home-based cosmetic entrepreneurs. If you’re creating handmade skincare products, selling through online platforms, or running a small-batch beauty brand from your home, Insurance Canopy protects your business from product defects, customer injuries, or contamination.
Yes. Our product liability insurance protects your business from claims related to allergic reactions, skin irritations, or other adverse effects caused by your products. Whether it’s a reaction to an ingredient or an issue with product contamination, this coverage helps cover legal costs, medical expenses, and settlements or judgments.
In most cases, yes. We can help ensure you meet specific insurance requirements for different regions, allowing you to confidently expand your business without worrying about coverage gaps.
When conducting international business, foreign liability reimbursement insurance can cover claims if a customer in another country is harmed by your product. It can address legal costs, settlements, or damages abroad that your standard U.S.-based policy might not cover.
Product recall insurance (available as an add-on) helps cover the costs of taking products off the market, notifying customers, and handling other related expenses. While this coverage doesn’t replace lost income from a shutdown, it can ease the financial burden tied to recall-related expenses.
Smooth Coverage for Every Bump in the Road
Sometimes an underwriter can be like the character The Banker on the TV
Starting a makeup line has plenty of glitz and glam, but a lot
Insurance has been around for decades acting like an invisible shield between claims
Our Footers Are Big.
Our Savings Are Bigger.
All policies have conditions, limitations and exclusions, please read the policy for exact verbiage.
Claim scenario circumstances vary in nature and similar claims do not guarantee coverage.
Insurance Canopy | © 2025 | Privacy Policy | Terms and Conditions | All rights reserved.
♦ Ineligible Products:
♦ Location & Operational Exclusions
♦ CBD/TCH Exclusions
Do your operations fall under an exclusion, or do you have inquiries about product coverage? Our specialists are here to help you find the best solution. Feel free to contact us today to discuss your options and obtain the protection you deserve!