Home Business Insurance Needs for the Home Workplace
The workplace of today is much different than the typical 9-to-5 job of past decades. With use of the internet as widespread as driving a car, you have numerous options when it comes to where and when you work. Owning a home-based business offers many freedoms and is a trend that isn’t showing signs of slowing down any time soon. This means that working from home adapts well to our current culture, making your chances of success in your home-based business much greater. Home business insurance can provide liability and property protection.
It takes lots of time, energy, and money to start and operate a business from home, and you want to protect all of these investments as much as possible. However, many small home business owners don’t have additional coverage beyond their regular homeowner’s policy.
Risks of Not Having Insurance for Your Home-Based Business
Although your homeowner’s policy will cover damage or loss associated with your personal property, deliveries for your business offer the risk of slips by delivery drivers, for instance. This wouldn’t typically be covered under a standard home insurance policy, nor would business equipment damaged in a fire.
Determining Your Home Business Insurance Needs
The types of insurance coverage you need for your home-based business will depend on numerous factors. However, there are typically 3 basic options when determining the best home business insurance for you.
This type of home-based business insurance is often ideal for the smallest businesses, as it is the most simple and affordable option. Policy endorsements are also known as ‘riders’ because they’re added to your existing homeowners policy. If you don’t manufacture goods for your home business or you are a solo operation, this could be the best option.
In-home business insurance involves combining your home and business insurance into one plan. This type of coverage offers more specific coverages that you may need as your business grows and also offers a greater range of coverage for home insurance for small business. Small baking operations, a tailor who fits clients, or an accountant who meets with clients in their home would likely benefit from this type of insurance coverage.
Also known as a BOP, a business owner's policy offers the most comprehensive coverage for small home business owners and provides protection for employees or customers who file claims against your business, protection from contractors, and comprehensive property coverage. However, not all types of home businesses qualify for a BOP.
Additional Business Insurance Coverage
Although one of the main types of home business insurance may be sufficient for your insurance needs, it’s usually a good idea to purchase additional coverage to fit them more specifically.
Often required by states for home-based business owners, workers’ compensation for your employees covers expenses associated with injury or illness due to working for your business. Even if not required by law, it’s wise to offer workers’ compensation if possible.
Data compromise involves a security breach compromising confidential customer information. Data compromise coverage protects your business if there is any legal action taken against you by your clients or customers.
Similar to workers compensation and data compromise coverage, employment practices coverage protects you if lawsuits are filed against you by one of your employees.
This type of coverage is essentially life insurance for a person vital to the successful operation of your home business.
Your small home-based business is like no other, and that should be reflected in your home business insurance coverages. The ability to grow with your business can become limited when unfortunate circumstances beyond your control put you at financial risk. Because the future of your business is greatly dependent on the types of insurance coverage you have, discuss your options carefully with a trustworthy agent.