Amazon will begin paying customers up to $1000 if they have been injured by dangerous or faulty products sold by third-party merchants on its platform.
Amazon, which now sees more than half of the sales on its marketplace come from independent sellers, has come under increasing pressure in recent months to take responsibility for the safety of items sold on its website.
From September 1, Amazon says it will now offer compensation for personal injury or property damage on claims of up to $1000.
According to the retail giant this will cover over 80 per cent of all claims made against it, but it added that it will “step in to pay claims for higher amounts if the seller is unresponsive or rejects a claim we believe to be valid.”
In a blog post Amazon said that it will utilise “advanced fraud and abuse detection systems with external, independent insurance fraud experts” to weed out fraudulent claims.
“By standing behind customers and the products in our store, regardless of who sells them, Amazon is going far beyond our legal obligations and what any other marketplace service provider is doing today to protect customers,” it added.
READ MORE: Amazon is being sued to remove hundreds of thousands of dangerous products from its marketplace
Last month Amazon was sued by the US Consumer Product Safety Commission (CPSC) in a bid to force it to accept responsibility for removing vast quantities of hazardous products sold by third-party sellers on its platform.
The products in question included nearly 400,000 hair dryers sold without protection against electrocution, 24,000 faulty carbon monoxide detectors that fail to alarm and numerous children’s garments which are in violation of flammable fabric safety standards.
Until now Amazon has been able to largely sidestep responsibility for the items sold by third-party merchants, arguing that it acts as a “service provider”.
But the retail giant has gradually been forced to accept more responsibility following a spate of legal battles.
In August last year, the California Fourth District Court of Appeals ruled that Amazon can now be held liable for any injuries caused by defective products sold by third party merchants on its platform, overturning a previous ruling by the San Diego Superior Court.
Then, in March this year, Amazon faced another court battle over whether it is responsible for the safety of products sold on its platform after a 19-month-old child was left severely burned.
“The tide has changed now,” Brooklyn Law School professor Aaron Twerski told the Financial Times.
“I think (Amazon is) dead in the water, because they’re wrong. They’re just plain simply wrong.”