Amazon Will Now Pay Customers for Defective Products Starting Sept. 1, the company will pay out valid claims of up to $1,000 at no cost to sellers, but can intervene if sellers are unresponsive.

By Entrepreneur Staff

entrepreneur daily
Bloomberg | Getty Images Inc. announced Tuesday a new plan to pay customers who suffer injuries or other damages from defective products others sell on the platform.

Starting Sept. 1, Amazon will pay out valid claims of up to $1,000 at no cost to sellers, but can intervene if sellers are unresponsive.

The move "better protects Amazon customers and sellers," according to the company, but it also better protects Amazon itself.

Related: Amazon will give 10 dollars to users who register the palm of their hand

The new policy follows years of consumers suing the e-commerce giant over defective or dangerous products purchased from online sellers. The policy is designed to reduce that litigation, although courts have tended to side with Amazon and agree that sellers are responsible for the goods they provide.

One state appellate court in California said last year that Amazon could be liable for goods it stores and ships using its Fulfillment by Amazon program.

Tuesday's announcement also included Amazon Insurance Accelerator, a group of insurance providers that sellers can use if they want to.

There is an update to policy requiring them to get product liability insurance.

Entrepreneur Staff

Entrepreneur Staff


Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Related Topics

Business Solutions

Stay Organized with This Task Management Tool, on Sale for $30

A Study Planr Pro subscription is just $30 for life.

Business Ideas

55 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

Thought Leaders

10 Simple, Productive Activities You Can Do When You Aren't Motivated to Work

Quick note: This article is birthed out of the urge to do something productive when I am not in a working mood. It can also inspire you on simple yet productive things to do when you're not motivated to work.

Business News

Here Are 3 Strategies Startup Founders Can Use to Approach High-Impact Disputes

The $7 billion "buy now, pay later" startup Klarna recently faced a public board spat. Here are three strategies to approach conflict within a business.

Operations & Logistics

7 Books For Maximizing Life Satisfaction During Uncertain Times

You can develop a philosophy by drawing from the perspectives of others.