I haven't been able to upload a photo through the Insert photo command for months, so I started using the File Manager instead. Two days ago, that stopped working. Changing browsers, as suggested above, worked for me. I was using Google Chrome and tried Safari instead. Insert photo, then upload from my computer worked perfectly. Thanks for the suggestion!
I had that issue every once in awhile - a couple things I did. 1) make sure files are saved for optimal web use. 2) on the desktop version of SiteBuilder I drag and drop my images into the folder I want them in - then upload them. Then I bring them into the page I want. This lets me add multiple images into the folder rather than one upload at a time. 3) make sure you paid for enough space.