Is Your Home Business Covered?

by Travis Etheridge

Home businesses are not new to the scene, but in recent years, we have seen that model grow. Many of us are turning to our side gig into our main business and using the extra space at home as operations. No matter if the home-based business is full-time or part-time, business insurance is likely a requirement in your state.

Your insurance selection should be based on the type of business you run. For example, if you’re an independent accountant working from the office you created in your home, you’ll have different insurance needs than a neighbor who runs a personal training business.

When selecting insurance for your business, here are some considerations:

Type of business
If there’s a business vehicle
The risks of the business
The type of business equipment and their worth
If the business requires staff/employees
If clients and or employees will visit the home business
How you plan on protecting personal/sensitive information

The type of insurance options that you will need to consider for your business:

Property insurance: insurance to protect the value of your business property from loss due to theft, fire, or other insured accidents/incidents.
Liability insurance: coverage for someone being injured as a result of visiting your business, using your product, and/or service.
Business vehicle insurance: you’ll want to consider this if your business owns vehicles or, if you use your personal vehicle primarily for business purposes. In some states, a personal auto policy will not cover an incident that was caused by operating the vehicle for business.
Workers Compensation Insurance: this covers the costs of an employee being hurt on the job, it also provides wage replacement and medical benefits (in some states, workers compensation insurance is mandatory, so be sure to check your state’s workers compensation website for local requirements).

A few more detailed considerations and coverages for you homebased business because, your homeowner’s insurance may provide some protection for your business, however, the coverage may not be enough:

Adding endorsements to your insurance policy. Endorsements are amendments or an addition to an existing insurance policy, which changes the terms/coverage of the original policy.
Purchasing a stand-alone home-based business insurance policy. This policy is one that provides excess coverage according to its own terms and conditions.
A business owners policy. This is a special commercial policy made for small and medium-sized businesses. This type of policy allows the bundling of general liability and property insurance into one combined policy- making it a little less costly.

There may be other insurance policy/coverage options for your home business. It’s important to schedule a chat an insurance agent who is knowledgeable and experienced with home business insurance.