TL;DR: depending on what you do next, your U.S. company will often need one or more of these: general liability to work with clients and landlords, workers’ compensation once you hire, commercial liability with product coverage to sell on Amazon, and D&O insurance when you raise from U.S. investors. This guide shows what each one covers, when it’s usually required and how to get covered without leaving Globalfy.
You’ve formed your LLC or C-Corp, gotten your EIN and opened your U.S. bank account. Congratulations. You’re officially doing business in the largest economy in the world.
There’s one step many international founders miss: insurance. In the U.S., it’s often the thing standing between you and your first big contract.
Which insurance does your U.S. company need?
| If you’re… | You’ll likely need | Who usually asks for it |
| Signing with U.S. clients, renting an office or joining events | General liability | Clients, landlords, venues |
| Hiring your first U.S. employee | Workers’ compensation | State law, in almost every state |
| Selling on Amazon US | Commercial general liability with product liability | Amazon, retailers, wholesale buyers |
| Raising money from U.S. investors | Directors and Officers (D&O) | VCs and board members |
Your LLC or corporation helps separate personal and business assets. But without insurance, a lawsuit can still drain your company’s bank account and stop your growth.
General liability: the coverage U.S. clients ask for
General liability (GL) insurance protects your business if someone claims you caused them harm. That includes:
- Bodily injury: a client trips over equipment at your event or pop-up shop.
- Property damage: your team damages a customer’s property while doing a job.
- Personal and advertising injury: someone claims your marketing copied their content or damaged their reputation.
GL typically pays for legal defense, settlements and medical costs, up to your policy limits.
The U.S. legal system works differently than many other countries. Lawsuits are common, and legal costs add up fast, even when you did nothing wrong. Defending a single claim can cost tens of thousands of dollars before it ever reaches a courtroom.
No federal law requires general liability. But in practice, you’ll often be asked for proof of coverage before you can do business:
- Client contracts: many U.S. companies won’t sign with a vendor or contractor who can’t show a Certificate of Insurance (COI).
- Office or warehouse leases: landlords commonly require GL and may ask to be listed as an additional insured.
- Marketplaces and platforms: Amazon, retailers and wholesale buyers often require liability coverage above certain sales levels.
- Licensing: some states and cities require GL for certain trades and licensed professions.
- Events and venues: trade shows, pop-ups and venue rentals usually require proof of coverage.
If you can’t produce a COI when asked, you may lose the deal. Pricing depends on your industry, revenue, location and coverage limits. Many small businesses find GL more affordable than expected, especially compared to the cost of a single claim or a lost contract.
Workers’ compensation: required once you hire
Workers’ compensation (WC) covers employees who get hurt or sick because of their job. It typically pays for medical bills, lost wages while the employee recovers, rehabilitation and death benefits for the employee’s family.
It also protects you. In most cases, employees covered by workers’ comp can’t sue the employer directly over a workplace injury.
In almost every U.S. state, workers’ comp is required once you have employees. Unlike general liability, it’s required by state law, not just by contracts. The rules vary by state:
- Many states require coverage as soon as you hire your first employee.
- Some states set a minimum number of employees. Florida, for example, requires coverage at 4 employees for most businesses, but just 1 for construction.
- Texas is the main exception, where most private employers can choose not to carry it. Opting out comes with its own risks and reporting rules.
- High-risk industries like construction often face stricter rules everywhere.
The rule that surprises foreign founders: workers’ comp follows where your employees work, not where your company is registered. If you formed your LLC in Wyoming or Delaware but hire someone in California, Florida or New York, you generally need to follow that employee’s state rules.
Penalties for missing required coverage can include fines (sometimes calculated per day or per employee), stop-work orders, paying injury costs out of pocket and, in some states, criminal charges.
Independent contractors usually don’t count as employees for workers’ comp. But if a “contractor” works set hours, uses your equipment and takes direction like an employee, a state may treat them as one. Misclassification can lead to back premiums and penalties.
Selling on Amazon US? The insurance Amazon requires
Under Amazon’s Business Solutions Agreement, professional sellers must get commercial liability insurance within 30 days after passing $10,000 in gross sales in a single month on Amazon.com. Amazon can also request proof of insurance at any time. Miss the deadline, and you risk having your account restricted right when sales are growing.
Amazon’s requirements are specific. Your policy generally needs:
- Commercial general liability that includes product liability.
- At least $1 million per occurrence and $1 million aggregate.
- Coverage for all products you sell on Amazon.
- “Amazon.com Services LLC and its affiliates” listed as an additional insured.
- Your legal entity name on the policy, matching your Seller Central account.
- Deductible limits set by Amazon, which can change.
A policy missing any one of these can be rejected when you upload your certificate. Always check Seller Central for Amazon’s latest requirements.
When you sell products in the U.S., you can be held responsible if one causes harm. Even if you didn’t manufacture the product, the seller can be named in a lawsuit. Product liability coverage helps pay for legal defense and settlements.
Other sales channels often have similar requirements. Other marketplaces like Walmart may require liability coverage, retailers and wholesale buyers commonly ask for a COI, and fulfillment centers and 3PLs may require coverage for goods in their warehouses. If you sell through your own Shopify store, coverage isn’t required by the platform. But the risk of a product lawsuit is exactly the same.
Raising from U.S. investors? You’ll likely need D&O insurance
For many international founders, forming a Delaware C-Corp is the first step toward raising from U.S. investors. But as your round gets close, you may see a new line in your term sheet or closing checklist: Directors and Officers (D&O) insurance.
D&O protects the people who lead your company, including founders, directors and officers, if they’re personally sued over decisions they made running the business. It can also protect the company itself when it’s named in those claims. Claims can come from investors, regulators, employees, customers, vendors, competitors or acquirers.
No law requires private companies to carry D&O. But in practice, investors often do. VCs who take a board seat typically want their partner protected before joining, and experienced independent directors may also ask about coverage before accepting a role. Without it, a round can be delayed, or a strong board candidate can walk away.
D&O typically covers legal defense costs, settlements and judgments, and investigation costs. Policies vary, and exclusions matter: fraud and intentional wrongdoing are generally not covered. Because D&O is usually written on a claims-made basis, it’s best to have it in place before your round closes and before new directors join your board.
How to get covered without leaving Globalfy
Buying U.S. insurance from abroad used to be hard. Many insurers expect a U.S. address, an SSN or long paperwork.
Now business insurance is part of the Globalfy platform, powered by Coverdash. Answer a few questions, get a quote back in minutes, compare your options and check out, all inside Globalfy. It’s the same place where you already form your company, manage banking and stay compliant.
- Get a prequalified quote for the coverage you need.
- Manage and renew your active policy in the platform.
- Download your certificate of insurance whenever a client asks.
- Go through the full flow, from quote to support, in English, Portuguese or Spanish.
Already a Globalfy member? Log in and find Insurance in your account.
Still need your U.S. company? Open your LLC with Globalfy and get insurance in the same place.
This content is for general education only and is not legal advice. Coverage is offered through Coverdash, a licensed insurance agency, and underwritten by third-party carriers. Globalfy does not sell or underwrite insurance policies. Availability and terms vary by state and carrier.