Business Basics Resource Guide
Milt Wright & Associates
How Do I Insure My Business at Home?
If
you're running a business from your home, you may not
have enough insurance to protect your business equipment.
A typical homeowners policy provides only $2,500 coverage
for business equipment, which is usually not enough
to cover all of your business property. You may also
need coverage for liability and lost income. Insurance
companies differ considerably in the types of business
operations they will cover under the various options
they offer. So it's wise to shop around for coverage
options as well as price.
Regardless of the type of policy you choose, if you're a professional working out of your home, you probably need professional liability insurance. Some types of in-home businesses, such as those that make or sell food products or sell home-made personal care products, may have to buy special policies.
To
insure your business, you have three basic choices,
depending on the nature of your business and the insurance
company you buy it from. They are:
Homeowners Policy Endorsement
In-Home
Business Policy/Program
Business Owners Policy (BOP)
1.
Homeowners Policy Endorsement
You may be able to add a simple endorsement to your
existing homeowners policy to double your standard coverage
for business equipment such as computers. For as little
as $25 you can raise the policy limits from $2,500 to
$5,000. Some insurance companies will allow you to increase
your coverage up to $10,000 in increments of $2,500.
You can also buy a homeowner’s liability endorsement. You need liability coverage in case clients or delivery people get hurt on your premises. They may trip and fall down your front steps, for example, and sue you for failure to keep the steps in a safe condition.
The
homeowner’s liability endorsement is typically
available only to businesses that have few business-related
visitors, such as writers. But some insurers will provide
this kind of endorsement to piano teachers, for example,
depending on the number of students. These endorsements
are available in most states.
*The Build WorkSource web site provides material on topics of interest to businesses. It is not intended as legal advice or to answer specific legal or employment problems. The information presented in the Build WorkSource web site is from many sources therefore there can be no warranty or responsibility as to the accuracy, originality or completeness. Build WorkSource is not engaged in rendering legal or other professional counsel.