E-Commerce Company Insurance in Washington State

E-commerce companies face a sprawling risk landscape that combines the traditional liabilities of retail with the digital exposures of a technology business. Whether you sell your own branded products, resell third-party goods, or operate a marketplace connecting buyers and sellers, Washington law holds you accountable in ways that many online sellers do not fully appreciate until a claim arrives. The state's Consumer Protection Act (RCW 19.86) is one of the most aggressive in the nation, giving consumers and the attorney general broad power to pursue unfair or deceptive business practices — and online advertising claims, pricing errors, and product misrepresentations all fall squarely within its reach.

General liability with product liability coverage is the foundation for any e-commerce company. If a product you sell injures a consumer, you face strict liability in Washington regardless of whether you manufactured the product. A defective kitchen appliance that causes a fire, a children's toy with a choking hazard, a supplement that causes an adverse reaction — as the seller, you are in the chain of distribution and therefore legally responsible. Even marketplace operators who never touch the product face increasing legal exposure, as courts and regulators push to hold platforms accountable for third-party seller products. Product liability claims can easily reach six or seven figures when injuries are serious, and class-action exposure compounds the risk when a defective product was sold to thousands of customers.

Cyber liability is critical for e-commerce operations. Your website collects and processes customer payment information, personal addresses, email addresses, and browsing data. PCI DSS compliance is required for anyone processing credit card payments, and a data breach triggers Washington's notification law (RCW 19.255.010), which mandates notification within 30 days of discovery. Beyond regulatory compliance, the direct cost of an e-commerce breach is severe: forensic investigation, customer notification, credit monitoring, legal defense, and the devastating loss of customer trust that can permanently damage your brand and revenue.

Business income loss from website downtime is an underappreciated risk for e-commerce companies. Your website is your storefront, and when it goes down — due to a cyberattack, hosting failure, or platform error — you lose revenue every minute. During peak selling periods like Black Friday or holiday season, even hours of downtime can cost tens of thousands of dollars. Advertising injury is another significant exposure: copyright infringement in product photos, trademark disputes in product listings, and defamation claims from competitor comparisons generate real litigation that general liability's advertising injury coverage helps defend.