If My Business is Based Out of My Home, Do I Still Need to Insure It?

Reasons to Insure Your Home-Based Business 

If you’re reading this, it’s likely that you are either thinking of starting a home-based business or have already started one. Maybe you have an idea and want to test how profitable it is. Perhaps renting space just doesn’t make sense for your business model. It could be that you just want to be closer to your family throughout the day. Whatever your reason for starting a home-based business, it is wise to research your financial risk before an incident occurs.

Unfortunately, homeowners or renters insurance policies do not typically provide coverage for business equipment losses by flood or fire. The cost of your equipment and inventory is certainly one piece of the risk puzzle for home-based businesses, but there are other exposures you should watch out for as well. For example, if clients come to your property regularly, someone could injure themselves and need medical attention. If a client claims your business offered bad advice and tries to sue you, what would you do? Every business is unique and comes with its own set of risks. Reaching out to a local insurance agent is one way to find options for insuring your home-based business.

What Types of Home-Based Businesses Should Consider Insurance? 

Deciding if your home-based business needs insurance coverage is a decision only you can make. Below is a non-exhaustive example list of types of home businesses that should consider business insurance coverage.

• Accountant
• Auto Detailing
• Business Consultant
• Catering
• Daycare
• Dog Groomer
• Ecommerce store
• Personal Trainer
• Photographer
• Videographer
• Web Designer

Even if your business is not on this list, you may consider getting commercial insurance coverage for your business if:

• You keep a large supply of inventory in your home
• Clients come to your home
• You have employees working in your home

How Much is Insurance for a Home-Based Business? 

How much it will cost to insure your home-based business will depend on the coverages you choose, the type of business you have, the cost of your business equipment, and a few other factors. You can request a quote from us here. We work with dozens of insurance carriers, from national names to local companies. If you would prefer to call someone directly to start the quoting process, you can find a list of our offices here.

Options for Insuring Your Home-Based Business 

Home-based businesses vary in size and scope. If you are looking for insurance coverage for your business, there are a few options.

Homeowners Policy Endorsement

If your plan is to have less than $5,000 worth of business property at your home, an endorsement to your existing homeowners policy may be the right fit for your business. If you plan to invite clients to your property, this may not be a good fit for you. Connect with your local insurance agent to review policy details to see what coverages would be included in a homeowners policy endorsement.

Different Types of Business Insurance Policies

If you have more than $5,000 worth of business property at your home, you should consider one or more business insurance policies. This may also be a good option for your business if you have clients coming to your home. Some common types of business insurance are general liability insurance, commercial property insurance, and professional liability insurance. General liability insurance typically covers bodily injury to third parties, such as customer slips and falls, and can also cover copyright infringement. Commercial property insurance can help to protect your equipment, inventory, and even outdoor signage. If you offer professional advice to clients, you should consider professional liability insurance. Other types of business insurance policies may be available as well – feel free to reach out to us to discuss your options.

Business Owners Policy  

If your home-based business needs more than one type of business insurance, such as a general liability policy and a commercial property policy, consider looking at business owners policies. Business owners policies typically combine general liability and commercial property insurance into one policy. There is often a cost savings with these, as opposed to purchasing the policies separately. Reach out to your local insurance agent to see what is available for your home-based business.

Top Insurance Companies for Home-Based Businesses

If you are looking to compare quotes from insurance carriers for your home-based business, our knowledgeable staff can help you with the process. You can see a list of the companies we represent here. Request a quote today to see what options are available for your home-based business.

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This article is for general informational purposes only and is not to be relied upon or used for any particular purpose. Cross Insurance shall not be held responsible in any way for, and specifically disclaims any liability arising out of or in any way connected to, reliance on or use of any of the information contained in this article. The information contained or referenced in this article is not intended to constitute and should not be considered legal, insurance, accounting or other professional advice, nor shall it serve as a substitute for the recipient obtaining such advice. The views expressed in this article are that of its author and do not necessarily represent the views of Cross Financial Corp. and its subsidiaries and affiliates (“Cross Insurance”) or Cross Insurance’s management or shareholders.