If you have a home-based business or you frequently work from home, having both your office space and the business itself insured is an essential part of your responsibility as a business-owner. One option that you may be considering is including your business as part of your home insurance. While on the surface this may seem like a good idea, it may not be enough coverage in some situations, or none at all in other situations. Here are a few things to consider when it comes to protecting your home-based business.
What Does Homeowner’s Insurance Cover?
The coverage you receive from your homeowner’s insurance will depend on your policy and the optional endorsements included, but in general, it protects your home in case of damage or loss from a number of causes, such as fire or wind. This will usually include both the property itself and your personal contents.
With a home-based business, your homeowner’s policy typically limits your business contents coverage to only $2,500. Also, there will be no liability coverage for your business offered by your homeowner’s insurance policy. To get a better idea of what your homeowners covers (and does not cover) start by reviewing your specific policy jacket for limitations and exclusions when it comes to your home-based business. Your agent can also help you identify these.
What Type of Insurance Does a Home Business Need?
One of the biggest considerations in deciding if you will need separate business insurance for your home-based business is whether the issue of liability will ever come up. If clients enter your home for any reason or you have frequent business-related deliveries to your home, your homeowner’s insurance will not cover any injuries these people may receive on your property. Some insurance companies will not even cover the home itself if clients enter the dwelling. Also, if you have any employees, even if they work only a few hours here or there, you will need separate insurance to cover them.
If you run a home-based business, your best choice in ensuring both your home and business are covered is to contact us so we can discuss your particular situation. Each situation is researched on a case by case basis, depending on your specific circumstances. Your business is your livelihood and your property is your home; ensuring that they are both covered should anything happen is important to both you and your family.