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Is It Necessary to Insure a Home-Based Business?

Is It Necessary to Insure a Home-Based Business?

Call (800) 641-7488 to speak with a live representative

home-based insurance

Is It Necessary to Insure a Home-Based Business?

With more and more small business starting or operating from home, 52% to be exact, it is more important than ever to carry a business insurance policy for your home-based business.  While running a business from home is both convenient and cost-effective, risks for lawsuits and damage still apply.  It is important to remember that a home-based business is still a business, and needs to be insured like any other business.

Why won’t a homeowners policy cover your home-based business?

In order to safeguard against risks associated with your business operations, you need to be aware that your homeowners or renters insurance policy offers limited or no protection for your business.  A typical homeowners policy is not intended to cover business related exposures.  While an insurance company may cover property losses such as your desk, file cabinet, computer, etc. your business inventory, tools, merchandise and other property will not be covered in any type of property loss.  Furthermore, your homeowners policy will provide no liability coverage for losses to your home-based business.

What coverage does your home-based business need?

Carrying liability insurance will protect your home-based business when it is liable for damages, both to a person or to a person’s property.  Liability claims are sometimes the mostly expensive claims a small business may face.  A general liability policy for your home-based business is the ultimate method of protecting your small business.

It is crucial for any small business owner to carefully analyze their business’ operations to identify what other types of coverage are needed.  A few questions to ask are:

  • Do you expect customers to visit you at home?
  • Will you be providing a professional service?
  • Do you use a vehicle in your business’ daily operations?
  • Will you sell your products or services online?

These questions will help assess the risk associated with your home-based business and determine the type of business insurance policy you may need.  It is important to discuss your specific business operations with an agent in order to help build a policy fit to your business’ needs.

The potential for risk will always be associated with running a home-based business.  Insuring your business is more affordable than you think.  Call an agent today for more info or to request a small business insurance quote.

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