Distributor Insurance
Whether you import it, store it, or ship it, we protect your business from product-related risks.
- Fulfill business-to-business (B2B) and direct-to-consumer (DTC) seller requirements
- Coverage for product-related lawsuits, defects, and costly claims
- Say yes to more orders with personalized protection
What Is Distributor Insurance?
Distributor insurance is designed to protect your business from claims tied to the products you buy, store, manage, or deliver. It’s a type of small business insurance made to cover injuries or damages caused by the items you distribute.
Product liability insurance for distributors keeps your operations moving forward if a claim disrupts your supply chain!
Who Needs Distributor Liability Insurance?
If your business distributes physical products in the U.S., you need distributor insurance. This includes popular industries like:
Wholesalers | Dropshippers | Private Labelers | Fulfillment Centers | Value-Added Resellers (VARs)
Why Do Distributors Need Product Liability Insurance?
You could be held legally responsible if a product you handled causes harm or damage. When your business’s name is on a product, you could be liable in a claim or lawsuit.
Product liability insurance for distributors protects your business from potential risks, turning costly claims into manageable setbacks.
Retail compliance
Easily meet retailer and online marketplace requirements for a Certificate of Insurance (COI) and keep your products moving through the pipeline
Injury claim
Your policy can cover mistakes in manufacturing or missing instructions that can lead to customer injuries
Defective goods
If your warehouse receives a defective shipment, distributor insurance can cover accidents caused by the faulty products
Labeling issues
Your policy helps cover treatment costs and protects your business reputation if a product reaches customers without proper safety warnings
You can be sued, held liable, and removed from platforms if you don’t have the proper protection. Product liability insurance takes care of those costs and gives partners confidence that your business is built to last.
How Much Does Product Liability Insurance for Distributors Cost?
Most distributors pay between $700 and $3,000 a year for product liability coverage with Insurance Canopy. We’ll calculate your costs based on:
- Types of products distributed: Higher-risk products like electronics or cosmetics may raise your premium compared to lower-risk items like apparel
- Annual revenue: More sales mean more potential exposure (and a higher chance of claims)
- Sales channels: Selling through big retailers, online marketplaces, or across state lines can increase risk and insurance requirements
- Coverage limits: Higher limits offer more protection but usually come with a higher premium
- Claims history: A clean track record may help lower your cost, while past claims can raise your rates
Your exact rate will depend on your unique business operations and risk profile. By getting a personalized quote, you can find coverage that fits your products, sales channels, and budget, and with a custom policy in place, you can focus on growing your business knowing you’re protected.
What Distributor Insurance Covers
Insurance Canopy’s general and product liability insurance for distributors includes up to $1 million per claim (occurrence) and $2 million per year (aggregate) in coverage for injuries, damages, and lawsuits.
Need to customize your coverage? Our licensed agents can help you build a policy that fits when and where you distribute!
Included
General Liability Insurance
General Liability Insurance covers third-party injuries and property damage from dock to door. From slips and falls in an office to dents made from a pallet jack, this policy can cover medical bills, legal fees, and settlements.
Products & Completed Operations Insurance
Product Liability Insurance protects you if a product you distribute leads to injury, property damage, or legal issues — even if you didn’t manufacture it. This coverage helps protect against these types of claims, as well as product defects, mislabeling, poor packaging, and faulty designs.
Recommended Add-ons
Product Recall Insurance
Product Recall Insurance covers notifications, return shipping, disposal, and public relations (PR) support triggered by a recall. It can apply to safety concerns, labeling issues, or supplier defects.
Inland Marine Insurance
Inland Marine Insurance protects your goods while in transit or stored off-site. If items are damaged or stolen, this coverage helps reimburse the cost to repair or replace them. It’s a smart choice for businesses using third-party logistics (3PLs) or managing a supply chain across multiple locations.
Commercial Auto Insurance
Commercial Auto Insurance protects any vehicles your business owns and uses for work, like vans or box trucks used for deliveries. This policy covers vehicle damage, medical bills, and legal costs caused by an accident, or expenses if a vehicle is vandalized or stolen.
Workers Compensation Coverage
Workers Compensation helps pay for employees’ medical treatment, lost wages, or funeral expenses for work-related injuries and illnesses. It’s required in most states if you have employees, especially when tasks like lifting, loading, or operating equipment are part of the job.
Cyber Liability Coverage
Cyber Liability Insurance for distributors covers the cost of data breaches, ransomware, and digital threats. If your system is hacked or customer information tied to your product distribution is stolen, this covers legal help, credit monitoring, and public relations support.
Worldwide Coverage Endorsement
Worldwide Coverage Endorsement can protect you from claims that happen outside the U.S. If you distribute to international markets, or if your products end up in overseas markets, this endorsement keeps you covered wherever your goods go.
Primary & Non-Contributory Endorsement
A Primary and Non-Contributory Endorsement states that your insurance is the “primary” coverage and doesn’t rely on a partner’s policy to respond first. Contracts with big-box retailers or third-party logistics providers often require this, even if someone else shares the blame.
Waiver of Subrogation Endorsement
A Waiver of Subrogation ensures your insurer won’t pursue your business partners (like a fulfillment center or co-packer) for costs after a claim. It helps you stay compliant with vendor contracts and fosters smooth, positive relationships in your supply chain.
30-Day Cancellation Notice Endorsement
A 30-Day Cancellation Notice makes sure your partners get a 30-day heads-up if your insurance is set to cancel. It’s a small but important step to keep your supply chain relationships on solid ground.
135,000+ Businesses Trust Insurance Canopy
From consumer goods to industrial parts, Insurance Canopy helps distributors protect their businesses with custom coverage that fits real-world operations.
- Apply online: Share some quick details about what you distribute and how your business operates
- Customize your coverage: Choose limits and endorsements that match your needs
- Get your quote: Receive your quote within 24 hours and pay online to get your COI
-
Thank you so much
Steve Monreal
July 11, 2025I 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 Calaway
July 4, 2025Very easy & quick experience. We got insurance in no time with no hassle. Thank you!
Robert Earnest
July 4, 2025 -
I 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 Pacheco
June 27, 2025great 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
Gretje Angell
June 18, 2025What 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 Rusanov
June 18, 2025 -
Needed DJ insurance for Memorial Day weekend & was squared away within an hour for 2 events! Highly recommend
Jay Solis
June 18, 2025Very 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 Riley
June 18, 2025Would 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 Burgess
June 18, 2025 -
Representative 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.
queenkiam
June 18, 2025Very easy to renew policy
Elyce Nissinoff
June 18, 2025They can help.you with the right Insurance you need, and the lowest price
Alvaro Baltazar
May 18, 2025 -
Provides event insurance at a very reasonable price compared to other companies. Easy to purchase and provide proof of insurance.
David Fox
May 18, 2025Affordable for dance & yoga folk. Thumbs up!
Maia Claire
May 18, 2025Extremely affordable event insurance and an easy to work with system and team that will advise you every step of the way!
Ishan Arvin
May 18, 2025 -
everything is excellent
Radames Martinez
May 18, 2025I'm a new customer/policy holder. Super easy online application and policy setup. Very competitive rates. Certificate of insurance generated and received (PDF) immediately once method of payment established. Great service... Read More
Matthew Terry
April 18, 2025For me, this application process was super efficient and easy to navigate on line. That goes a long way!
Holly Mulder
April 18, 2025 -
Affordable. Thank you.
Ana Young
April 18, 2025I have not had any issues over the years with Insurance Canopy, with canceling and renewing, I have found the cost of coverage in line or better then some. I have... Read More
John Corkins
March 18, 2025Canopy insurance has covered my DJ business for several years and I am totally satisfied with their services. Thank you DjVic🎧
DjVic Universal Sounds
March 18, 2025 -
I have them for 3 years this year seems price went up . I have never had to use them for a claim so really couldn’t tell you about that!
Denice Lapointe
February 18, 2025Great for Event Insurance - most affordable
Gaby Nobrega
February 18, 2025I was feeling overwhelmed with the specifications needed for my insurance coverage. I was offered friendly, quick and clear assistance. Through Canopy and Rey's help I was able to obtain... Read More
ESPIE QUINTERO
February 18, 2025 -
TLJ's Mobile Mixology, LLC had been insured with Insurance Canopy since it's inception and we have no complaints.
Tenisha J.
February 4, 2025Knowledgeable, kind, attentive and professional. She helped me to feel comfortable, well taken good care of and get the service possible.
Ed Levitt
February 3, 2025As a Massage Therapist, I was not aware until a few years ago that I did not have to be part of an Organization to get my liability insurance! I... Read More
Kristie Williams
January 30, 2025 -
This insurance has helped me secure events with my corporate and local government clients. They have great customer service and are always willing to help.
Tony Felix
January 23, 2025Representative was clear & concise in explaining specifics of the policy. Cost of policy very reasonable.
John B
January 16, 2025I’m very happy with my purchase of liability insurance for a one-off event. I was even able to edit the policy after it had been issued with the help of... Read More
jay gedeon
January 6, 2025
-
Thank you so much
Steve Monreal
July 11, 2025 -
Very easy & quick experience. We got insurance in no time with no hassle. Thank you!
Robert Earnest
July 4, 2025 -
I 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 Calaway
July 4, 2025 -
I 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 Pacheco
June 27, 2025 -
great 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
Gretje Angell
June 18, 2025 -
Representative 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.
queenkiam
June 18, 2025 -
What 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 Rusanov
June 18, 2025 -
Needed DJ insurance for Memorial Day weekend & was squared away within an hour for 2 events! Highly recommend
Jay Solis
June 18, 2025 -
Very 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 Riley
June 18, 2025 -
Would 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 Burgess
June 18, 2025
Questions About Distributor Insurance
Are Distributors Liable for Product Defects?
Yes, distributors can be liable for product defects. Even if you didn’t cause the defect, you can still be held responsible if something goes wrong. That means you can be named in a lawsuit if an item you distribute is harmful, mislabeled, or fails to perform as intended.
What Kind of Insurance Do Distributors Need?
Most distributors need general liability and product liability coverage at a minimum. Depending on how your business runs, you may also need add-ons such as:
If you work with big retailers, fulfillment centers, or platforms like Amazon, you may also need special endorsements like a primary and non-contributory clause or a 30-day cancellation notice.
Is Liability Insurance Legally Required for Distributors?
Liability insurance for distributors is not always legally required, but it’s often necessary for contracts. Your need for insurance comes from contracts with platforms, retailers, or vendors. Without it, you may lose business opportunities or risk noncompliance with partners.
Can I Be Sued for Damages Caused by a Manufacturer?
Yes, distributors can be sued for damages caused by manufacturer defects, and it happens more often than you’d think. If a product is defective, missing safety labels, or causes harm, you can be pulled into the lawsuit as the distributor.
Even if the issue started with the manufacturer or the importer, you might still be named because you moved, stored, or resold the item. That’s where insurance steps in to help cover legal costs and damages.
What Happens if I Don’t Have Product Liability Insurance?
If you don’t have product liability insurance, you could be footing the bill for lawsuits, legal fees, or potential payouts out of your own pocket. You also risk:
- Missing out on key partnership opportunities
- Breach of contract agreements
- Reimbursement costs or account suspensions from online platforms
- Inability to grow your business into new markets
With the right coverage, you don’t have to take that risk.
Want to know more? Our product liability FAQs explain the risks, requirements, and coverage every distributor should understand.
Related Articles
Why Does My Vendor Require Product Liability Insurance?
As you grow your business, part of your new sales strategy may include
Best Business Insurance Alternatives For Amazon Sellers
As an Amazon seller, you are responsible for the safety of any products
How Product Liability Insurance Connects With Online Selling
Many business owners turn to Amazon and other ecommerce websties to sell their