Those customers who would be injured or suffer property damage from defective products that are sold by others on its e-commerce platform in the United States would be compensated by Amazon.com Inc, the largest e-retailer of the world said on Tuesday.

This new policy is aimed at reducing litigations against the company.  

The largest online retailer of the world have been facing legal cases from consumers for years arguing that the company was liable for a merchant selling bad or defective products on Amazon.com.

For example, a case was filed by a woman in Pennsylvania in 2016 blaming Amazon for a retractable dog leash that was sold by a third party on Amazon’s platform that blinded the woman when it snapped.

Amazon argues that the responsibility lies with the sellers themselves and most courts have ruled in favour of the e-retailer.  

However last year, a state appellate court in California declared that Amazon could be held liable for products that it stores and ships through its Fulfillment by Amazon program.

In its latest step the company said it will pay valid claims of up to $1,000, starting September 1, which account for more than 80 per cent of the injuries and damage cases on its platform. There will be no cost for the sellers and Amazon could even intervene with more help for consumers if the accused sellers remain unresponsive, the company added.

It said that the policy “better protects Amazon customers and sellers”.

The company also announced the launch of Amazon Insurance Accelerator which is a network of insurance providers that can be accessed by sellers if they so want, and an updated policy requiring more merchants to obtain product liability insurance.

The company said that Amazon itself will not providing this insurance.

(Adapted from NDTV.com)