If you are a new or veteran home-based business owner, you may believe that your homeowner or renter’s insurance policy give you protection on your business. Most homeowner and renter’s insurance policies offer little to no coverage for business-related losses.
A homeowner’s policy is not designed to cover business losses. Most policies cover a small amount of business property coverage, meant to cover incidental items, such as a computer used for office work.
Depending on the type of business you run in your home, you might be able to purchase a homeowner’s endorsement to cover your business property. Your insurance company will want to know more about your business. Questions include what type of business; how long have you been in business; and how many employees.
If your business is small with a low risk profile with limited client visits to your home, your homeowner’s insurance company might offer limited liability protection. This protection would cover anyone who slips or falls when you have a client visit your home-based business office.
If your homeowner’s insurance company does not offer this protection, you might want to consider a small business policy. This kind of policy would include liability and property coverage for your business.
If one or more of the items below apply to you and your home-based business, you will want to consider a business policy:
- Business Property, Stock or Equipment over $10,000 in Value
o A business policy will allow you to insure your office contents, equipment, and stock. A homeowner’s policy will likely have little, if any, coverage for business-related items.
- Clients visit your office/use your product/depend on your service
o Liability insurance can help cover your exposure to lawsuits resulting from slips and falls, product liability claims, and personal injury claims. Homeowner’s policies do not have coverage for business liability. Depending on your type of business, you might be able to purchase an endorsement to allow coverage for slips and falls due to customer visits.
- Damage to your workspace would require you to relocate or find a temporary space.
o Extra Expense coverage in a business policy will provide funds for a temporary workspace.
- Error or Omission could result in a lawsuit that would need to be defended
o Error and Omission coverage will protect you from judgments and defense costs resulting from past mistakes.
- Damage to your workspace could cause you to lose business or lose some customers.
o Business Interruption Coverage will help pay for expenses until your property is repaired or sales return to normal. (this depends on the policy form)
- Your employees use their vehicles to make deliveries or run errands for your business
o Non-owned auto liability will protect your business in the event that your employee has a serious accident during the course of running an errand for the business.
If you answered “yes” to any of the items above please give Frimark/Keller & Associates a call today at 847-907-4520 to make sure you are properly covered. It can save you hundreds.