Do Etsy sellers need insurance?

No, Etsy doesn't legally require you to have insurance to sell on their platform, but it's highly recommended to protect yourself from costly claims for product issues like injuries, damage, or allergic reactions, with Product Liability Insurance being the most critical type for covering product-related incidents. While Etsy's Purchase Protection helps with shipping/payment issues, it doesn't cover legal liability if your product causes harm, so external insurance is essential for peace of mind and business continuity, especially when selling items like cosmetics, food, or children's products.

Do I need insurance selling on Etsy?

Do I need business insurance to sell on Etsy? Put plainly, no. You are not legally required to take out any form of insurance before selling your handmade crafts on Etsy. That being said, it is generally a good idea to at least consider purchasing online retailer insurance before selling on this platform.

Does Etsy have insurance for sellers?

Though Etsy doesn't have insurance requirements, it does have "House Rules" for sellers. For example, every item listed on the marketplace must be handmade, vintage, or a craft supply. The Etsy Purchase Protection Program for sellers covers refunds on orders totaling up to $250.

Do I need insurance to sell handmade crafts?

Public liability insurance is not a legal requirement, however, some craft fair organisers will want to see evidence of the craft sellers' insurance. This is because during the craft fair, you will be interacting heavily with the public.

Do I need a licence to sell crafts?

FACT SHEET - STREET TRADING ART AND CRAFT EXHIBITIONS DO I NEED A LICENCE? With few exceptions, any form of selling of goods or the provision of services which takes place either in the street, or on the public footway, or up to 7 metres from any street, requires a licence.

How I Made Over $100,000 on Etsy Selling Digital Products

Is it risky to sell on Etsy?

Think of Etsy's security like a well-guarded craft fair. You'll find multiple checkpoints and protections designed to keep you safe. The platform's commitment to safety isn't just lip service. Etsy has implemented several measures to protect buyers and sellers every step of the way.

How much is Etsy insurance?

Etsy Seller Protection is free, but it's limited.

It does not pay for lawsuits, medical bills, or property damage caused by your products. For that kind of coverage, you'll need a separate Etsy seller insurance policy, which typically starts around $116/month through Insurance Canopy.

Do you have to tell HMRC if you sell on Etsy?

Moving forward, Etsy will report transactions for all UK sellers who meet the threshold, regardless of when they joined. If you're a seller who resides in the UK, Etsy is required to send your information to HMRC authorities when: You complete 30 or more transactions in a calendar year with physical goods.

How does Etsy insurance work?

Etsy offers tools and services for sellers, including a “Sellers Protection Policy.” This policy enables Etsy to work on your behalf to resolve customer disputes such as packages never arriving or items not being sold as described and other payment issues. However, Etsy does not provide product liability insurance.

How much can you earn on Etsy before paying tax?

Trading Allowance: For 2026, you're allowed a tax-free earning of up to £1,000 from self-employment, which includes income from Etsy sales. Exceeding Threshold: If your Etsy earnings go beyond this limit, you're obligated to declare them to HMRC and may need to pay tax on them.

Do you need insurance to sell products?

Product liability insurance

This is probably the big one. If something you sell causes injury or damage, you could be liable. Even if you didn't make the product yourself, you could still be responsible, especially if you're drop-shipping or reselling imported goods.

Why are vendors leaving Etsy?

Serious sellers are shifting to their own websites, building direct customer relationships, and focusing on long-term growth. It takes work, but it's the only way to own your business—without being at the mercy of a platform that puts profits over people. If you sell on Etsy, start thinking about your next move now.

Who is Etsy's biggest competitor?

Etsy's biggest competitors include Amazon Handmade, for its massive audience and fulfillment options, and Shopify, for sellers wanting a customizable, independent store. Other key rivals depend on the product, with eBay offering broad reach, Redbubble for artists, and platforms like Goimagine focusing specifically on handmade goods.
 

How much does an average Etsy seller make?

Here Are Some of Our Key Findings: Average Earnings: On average, an Etsy seller earns about $35,583 in revenue per year and around $2,965 per month. Top Sellers: Top Etsy shops far exceed average figures—boasting lifetime revenues nearing $20 million and annual revenues over $2 million.

Why are Etsy's fees so high?

Pros of Etsy's Transaction Fees

starting your own site: 👍 More Marketing = More Buyers: Etsy says one of the key reasons they're increasing transaction fees is so they have more money for marketing. Etsy says they spent close to $600M in 2021, and intend to increase that spend in 2025.

What is small craft insurance?

Our Small Craft Insurance will cover most types of small sailing boats, small motorboats, speedboats and most types of sailing dinghies when used on inland and coastal waters of Europe, up to 12 nautical miles offshore. We are not able to cover Jet Skis, Personal Water Craft (PWCs) or Jet Bikes.

What insurance do I need for a stall?

Public liability insurance can help protect your business in case of third-party injury or damage, maybe caused by a trip or slip over your stall, or injury caused by one of your products.