Etsy Purchase Protection: how it works for sellers

What Etsy Purchase Protection is for sellers

Etsy Purchase Protection is the program Etsy uses to settle certain buyer cases without taking the refund out of the seller's money. When an order is eligible and a buyer opens a case, Etsy refunds the buyer itself. Etsy covers up to $250 of a refund, and any remaining amount will be charged to the seller. If the order is eligible, you’ll keep your earnings from the sale.

There is nothing to sign up for. Etsy states there is no setup required from the seller: coverage depends on how you ship and how you answer the buyer. The rules described here apply to cases opened on or after May 7, 2026. Cases opened before that date follow the earlier version of the policy.

The program has firm limits. Etsy describes it as not an insurance policy, a warranty, nor a guarantee, and Etsy will decide, in its sole discretion whether a given order is protected. Etsy can also change, suspend, or discontinue the program at any time. Read it as a rule set you can meet, and plan for the orders it does not reach.

Which Etsy cases Purchase Protection covers

Etsy names four situations where Purchase Protection may apply, and several where it does not. The table puts them side by side, in Etsy's own words where possible.

Damage cover is the narrowest part of the program. A damaged item is covered only for the first instance per calendar year, so any later damaged-item refund in the same year is yours to pay.

The tracking, shipping and response rules you must meet

Etsy checks each order against a fixed list. Sellers are responsible for refunding costs for orders that don’t qualify for Purchase Protection. An order is eligible when all of these are true:

• Shipping time: the order was shipped within your stated processing time.
• Tracking: Valid tracking was provided and/or it was mailed out with a shipping label purchased through Etsy. Etsy may also use carrier tracking scans to confirm the order went out on time.
• Delivery estimate: your listing has an estimated delivery date, which includes transit times and, where applicable, an origin zip code.
• Listing accuracy: The item received by the buyer matches the photos and description on your listing.
• Service: You meet Etsy’s customer service standards.
• Response time: you answered the buyer's Help with Order message within 48 hours.
• Damage: it is the first instance per calendar year for your shop.
• US imports: Duties and import fees are included upfront if the order is shipping into the US.

The response rule is the easiest to miss. The clock starts with the buyer's Help with Order message, which comes before any case is opened, so answer every order question within 48 hours even if it looks minor.

How an Etsy case works, step by step

A case is a formal report of a problem with an order. Purchase Protection does not start on its own. Etsy states that the process only begins after a buyer reaches out to you about an order through a Help request, and the buyer then opens a case.

1. The buyer sends a Help request

   The buyer contacts you about the order through Etsy. Reply within 48 hours and try to fix the problem in Messages first.

2. The buyer becomes eligible to open a case

   To open a case, the order's maximum estimated delivery date must have passed, and it must be at least 48 hours after the buyer contacts you about the problem. For a package that never arrived, the buyer must wait 7+ days after the maximum estimated delivery date has passed.

3. The buyer opens the case

   Once eligible, buyers have 30 days to open a case. Etsy states that buyers can only open a case for these reasons: non-delivery, a late delivery, a damaged item, or an item that is not as described.

4. Etsy reviews the order

   For most cases, information available from the order’s shipping status and Etsy Purchase Protection eligibility criteria is used to decide the outcome. If Etsy asks you for more information, you must respond in the case log within the time given.

5. Etsy refunds the buyer or you do

   If the order is eligible, the buyer will receive a full refund, and Etsy covers up to $250 of a refund. If it is not, you pay the refund. Etsy can also resolve a case for you, issuing a refund to the buyer and recouping funds from your Payment account.

How to respond to an Etsy case

You manage open cases in Shop Manager. Go to Help and then Cases, then open the tab for cases reported about your shop. What you post there is what Etsy reads when it decides.

• Keep everything in one place. You must keep all information about a case in the case log, so move any details from Messages into the case.
• For a non-delivery case, Etsy needs proof the item was shipped to the address on the Etsy receipt or the address agreed upon in Etsy Messages. A valid tracking number is that proof.
• For a damaged or not-as-described case, acknowledge the buyer's problem in the case log and add photos by selecting Attach Image under the text box.
• Answer every request from Etsy. Etsy reserves the right to resolve a case on your behalf, issuing a refund to the buyer and recouping funds from your Payment account.
• If you choose to settle, a case closes automatically when You issue the buyer a full refund through Etsy Payments.

A single case does not mark your shop. Etsy states that An occasional case opened against a seller will not negatively impact them or their shop. Cases are judged against Etsy's customer service standards, which Purchase Protection also depends on.

Orders above the coverage limit

Etsy's cover is capped. Etsy pays up to the limit even if the order total exceeds $250, and the rest of the refund is charged to you. You do not issue the refund yourself; Etsy charges the difference to your account.

Example: a $400 hand-thrown lamp, shipped on time with an Etsy label, never arrives. Etsy refunds the buyer, covers up to $250 of a refund, and charges the remaining part of the refund to your shop.

Etsy's own suggestion for these orders is to consider purchasing shipping insurance for orders over $250. If you already hold insurance through a carrier, a third party or your payment processor, Etsy asks you to first submit a claim to your primary source of coverage before it pays.

Disputing a closed case outcome

You can ask Etsy to review only a closed case for an item that arrived damaged or different than described. A trained specialist will review your case and outcome against Etsy's policies, and you get a final decision by email within 1-3 business days.

Cases about an item that never arrived or arrived late work differently. For those, Etsy says we can’t review your outcome further. The only protection for those orders is shipping on time with tracking before the problem starts.

Where Nation fits

Questions about Etsy Purchase Protection and cases