Ensuring e-commerce activity: disputes, returns, data and product liability

Introduction

For a Swiss SME active in e-commerce, risks extend beyond inventory management and sales optimization. They encompass legal (customer disputes), operational (returns and warranties), technological (data protection), and liability (defective products) aspects. By reading this, you will learn how to structure an e-commerce insurance approach in Switzerland, which risks to document, how to prioritize them based on your business model, and what key decisions to make with your broker or insurer to manage your portfolio.

The Swiss legal framework does not include a specific "e-commerce" law, but cross-cutting rules apply to online commerce, notably the Federal Act against Unfair Competition (UCA) and the general principles of the Swiss Code of Obligations (CO) for online sales contracts. Insurance is a risk management tool (coverage, prevention, claims documentation), not simply a contract to be ticked.

1. Customer disputes and legal protection

1.1. Legal framework for e-commerce disputes

In Switzerland, the law applicable to online sales is based on the general provisions of the Swiss Code of Obligations. There is no specific legislation imposing a right of withdrawal or return as in European law: Swiss law does not provide for a statutory period that consumers can exercise after an online purchase, unless the seller voluntarily includes a provision in the general terms and conditions of sale.

The absence of specific rules does not exempt the operator from clearly informing the customer: the operator must indicate in the "impressum" his identity, his contact details and the technical steps leading to the conclusion of the contract (LCD art. 3).

These requirements reduce disputes related to contractual misunderstandings, but do not cover disputes over the conformity of goods, delays, or warranty claims.

1.2. Legal protection insurance

To cover the costs associated with disputes (legal advice, proceedings, arbitration), commercial legal protection insurance can be considered. This coverage helps anticipate and support legal actions against clients or suppliers, with a documented threshold for triggering claims based on the type of dispute (e.g., challenges to terms and conditions, claims for non-compliance). The decision should take into account the expected cost-benefit ratio for your business model (number of transactions, average order value, frequency of disputes).

2. Returns, warranties and logistics flow management

2.1. Returns and legal guarantees

Unlike common practice in the European Union, where a 14-day cooling-off period is imposed on certain distance contracts, Swiss law does not provide such a right for consumers in e-commerce by default (nor is it mandated by law). However, a business may offer a return policy for commercial reasons and state this in its terms and conditions.

The Swiss Code of Obligations also provides for a statutory warranty against product defects for a period of two years from delivery (warranty action as defined in Articles 197 et seq. of the Code of Obligations). The determination of the transfer of risk (the point at which the buyer assumes the risk of loss or damage during transport) must be defined in the General Terms and Conditions of Sale, as the law often places the transfer upon payment, unless otherwise agreed.

2.2. Goods/Transit Insurance

To reduce the financial impact of logistical damage or losses (transport, storage), cargo insurance can be beneficial. It covers stock in transit, logistical returns, and physical losses. For effective management, quantify the potential cost of incidents using an internal historical log and compare it to the premiums offered to determine the appropriate coverage level.

3. Customer data, cyber risks and business continuity

3.1. Data protection context

E-commerce activities systematically involve the collection and processing of personal data (contact details, purchase history, payment methods). Swiss data protection legislation (Federal Act on Data Protection, revised FADP) imposes obligations of transparency, security, and consent for this processing. Furthermore, companies processing data from European customers must often comply with the General Data Protection Regulation (GDPR).

A data breach can lead to customer compensation claims, regulatory investigations, and reputational damage.

3.2. Cyber insurance

Cyber insurance tailored to e-commerce typically covers:

• civil liability following a data breach or cyberattack (e.g., customer claims),

• the costs of post-incident notification and communication,

• the interruption of digital activity,

• Legal and technical advice in response to an attack.

For example, Zurich offers cyber modules including cyber liability, interruption insurance and real-time legal support, with integrated prevention.

In risk management, establish a profile of your critical digital assets and compare it to the limits proposed in insurance offers to calibrate the coverage.

4. Product responsibility in Switzerland

4.1. Foundations of Responsibility

In Switzerland, product liability is primarily governed by the Federal Act on Liability for Defective Products (LRFP) and, more broadly, by the civil law provisions of the Swiss Code of Obligations (Art. 41 et seq. CO). Under the LRFP, a producer (or a comparable party in the supply chain) can be held strictly liable if a defective product causes personal injury or damage to property (other than the product itself).

This liability is not solely contractual: it can arise independently of fault if the product does not offer the safety that one is entitled to expect.

4.2. Product liability insurance

For e-commerce businesses that manufacture, import, or distribute goods, product liability insurance is often essential. Product liability insurance complements the company's general liability insurance and covers damages caused by products sold through the platform.

Documenting quality control procedures, storage conditions, and recall procedures is essential for defending your claim in the event of a loss. Decide, with your broker, on coverage limits and exclusions (e.g., hazardous or regulated products).

Actionable benchmarks and checklists

Document this information before evaluating your insurance coverage.

• Up-to-date general terms and conditions of sale (GTC), including return clauses and transfer of risk.

• Register of customer disputes (type, cost, frequency).

• Inventory and description of the data processed (categories, location, security measures).

• Product quality procedures and evidence of conformity.

• History of logistical damages and returns.

E-commerce insurance management checklist

| Risk | Insurance to consider | Key document |

| Customer disputes | Legal protection | Dispute register + Terms and conditions |

| Returns & losses in transit | Cargo insurance | Logistics flows & carrier contracts |

| Cyber/data breach | Cyber insurance | Data mapping & PSR |

| Product responsibility | Product liability | Quality control & compliance |

Common mistakes and how to avoid them

Mistake 1 — covering risks without probability analysis

Align your insurance portfolio with quantified risks (past frequencies, nature of products) rather than with generalist offers.

Mistake 2 — forgetting cybersecurity as a business risk

Don't assume that standard liability insurance covers IT incidents. Specifically include cyber coverage.

Error 3 — not updating the terms and conditions

Outdated terms and conditions increase disputes and weaken your defense in the event of a claim. Review them annually.

Questions to ask your insurer/broker

1. What types of customer disputes are covered by legal protection?

2. Does cyber coverage include civil liability for data breaches?

3. What events trigger the handling of the business interruption?

4. Does the product liability insurance cover international sales?

5. How is the cost of product recalls treated in product liability?

6. What franchise thresholds are proposed and how are they determined?

7. What is the frequency of bonus revisions based on e-commerce turnover?

8. What documentation do I need to provide for an optimal claim?

9. Are my current terms and conditions considered adequate by the insurance market?

10. What assistance is included for cyber incidents or cross-border disputes?

Conclusion

Securing an e-commerce business in Switzerland is more than just ticking a box. It requires structured management of legal, logistical, technological, and product-related risks. Approach your insurance decisions with a simple method: document your situation, analyze your risk scenarios, determine the appropriate coverage levels, and rigorously monitor claims. The next logical step is to gather your documentation (terms and conditions, claims register, data inventory) and engage in a structured dialogue with your broker to formalize an insurance plan aligned with your growth strategy.