There are numerous benefits—and dangers—to running an internet store. Choosing the correct insurance coverage to protect your organization from possible litigation and claims may be a complicated ordeal. General liability insurance and professional liability insurance are two examples of coverage that you could come across. Still, which one is essential for your e-commerce site?
To assist you choose the right coverage for your internet company in the year 2025, this article compares and contrasts general liability insurance with professional liability insurance.
General liability insurance: what is it?
Your company can avoid lawsuits over allegations of **physical harm**, **damage to property**, and **advertising injury** by purchasing general liability insurance.
In most cases, general responsibility includes the following for internet stores:
Your advertising-related legal fees * Injuries sustained by customers on your property (if you have a storefront or warehouse) * Damages to other people’s property caused by your goods or services * Costs associated with defending yourself in court against allegations of defamation, slander, or copyright infringement
Physical dangers posed by third parties and some risks associated with advertising are essentially covered.
Specialists: What Covers Your Liability?
Professional liability insurance, also known as **Errors & Omissions (E&O) insurance**, protects policyholders against claims arising from **negligence**, **errors**, or **failure to execute professional services** in accordance with the agreed-upon terms.
Businesses that offer more than simply product sales, such as consulting, counsel, or specialized services, should prioritize this sort of insurance.
Here are some instances of suits involving professional liability:
Claims of late delivery, incorrect service, or failure to fulfill contractual duties * A client claiming your service or advise lost them money * Mistakes in service or advice Copyright violations associated with the provision of your services
What Kind of Insurance Is Necessary for Your Online Store?
Assuming You Deal In Tangible Goods
**General liability insurance** need to be prioritized by the majority of internet merchants selling tangible items. Claims involving injuries or property damage caused by your goods or company operations are protected by this policy.
Case in point: general liability insurance aids in covering legal expenses and damages in the event that a client sustains an injury as a result of a faulty product that they bought from your store.
In the event that your online store has a physical storefront or warehouse, general liability insurance will also cover any injuries that may occur on your property.
If Your Business Offers Expertise or Digital Goods
You must have **professional liability insurance** if your internet business provides services like digital marketing, consulting, coaching, software development, or graphic design.
This insurance safeguards you in the event that a client asserts that your service or guidance resulted in monetary harm as a result of carelessness, mistakes, or oversights.
Professional liability insurance could be useful for some online stores that offer digital goods or subscription services.
Is One Sufficient?
It is possible that some companies selling tangible goods and services may need **both** forms of liability insurance.
If you run a supplement business and also provide one-on-one nutrition coaching, for instance, you would want to get professional liability insurance to safeguard your consulting services and general liability to cover any problems with your products.
Extra Things to Think About When Buying Online
You may be required by some markets, such as Etsy or Amazon, to have general liability insurance.
* Cyber Liability Insurance: **Some insurers provide bundled policies that cover general liability, property, and business interruption**. * Business Owner’s Policies (BOP) are one example of this. Cyber insurance is another option for online stores to safeguard themselves against cyberattacks and data breaches.
Last Reflections
If you own an internet store, you need to safeguard it, but there are two types of liability insurance: general and professional. General liability insurance often addresses the primary concerns associated with selling tangible goods. Having professional liability insurance is essential if you offer any kind of expert service or digital product.
In order to get the finest insurance policy for your company in 2025, you need take a close look at what you do and talk to an insurance professional. Having the right insurance policy in place may protect your online store from expensive claims, allowing you to confidently focus on building your business.