View Full Version : Don't Forget Insurance For Your Home Biz

11-03-2005, 07:05 PM
Here are some thoughts on home based business insurance.

Donít Depend on Your Homeowners Insurance to Protect Your Business
Property insurance covers your stuff Ė desks, chairs, inventory, computers, etc. Liability coverage protects you against a lawsuit if someone is hurt either while visiting you or due to a defect in your product. In general, personal policies just donít do the job for a business.

Many homeowner policies provide only $2,500 of business personal property coverage at your house and $250 away from your premises. Buildings not attached to your home (a separate garage) that are used in your business are also not covered by most homeowner insurance policies.

Business liability incidents are also excluded by most home policies. Personal umbrella insurance offers no business coverage either.

When I started my consulting practice, I bought a business ownerís policy to cover my home office. You may need to do the same. Talk with your insurance adviser about your options.

Auto Insurance
Many home business owners are adequately covered by a personal auto policy. If you make deliveries or use a pickup or van, you may need to buy a commercial auto policy. Talk with your insurance agent.

Renting Cars
Buy the offered coverage when renting a car from Hertz, Avis, or other short-term rental companies. Their contracts make claims a nightmare, and include obligations not normally covered by standard auto insurance. One option may be using a credit card that provides collision damage waiver coverage as a cardholder benefit. Call the toll-free number on the back of your card to check.

Workers' Compensation
Most states require workers' compensation coverage if you have any employees. You also may be able to buy work comp on yourself as a way to have some protection if you can't find health or disability insurance. Talk with your agent.

Consider Professional Liability Insurance
If youíre a consultant, architect, real estate agent, or other professional giving advice, consider coverage for claims against you for errors or omissions. Professional liability is also known as malpractice insurance. It protects you from suits alleging your advice cost your customer or client money.

Pick Your Insurance Agent Well
Find an agent you feel is interested in your business. Get recommendations from your peers and friends. Select your insurance adviser in the same way you would choose an attorney or accountant. Use one agent for all your business and personal insurance. Meet at least once a year to discuss your needs.

11-12-2005, 02:33 AM
Small business owners also need to consider getting legal insurance. What would a small business owner do if they were sued? Hire a high priced lawyer or have a high priced 1 on retainer? What about the small business owner that has employees. How would the owner react if personal data was lost? How many small business owners know about the facta law?
These are things that small business owners need to get educated about.

11-26-2005, 02:43 PM
Make sure to carefully review your business insurance policy.

If you have just brought in $50,000 in inventory and have used your line of credit for the purchase, are you covered in case something happens to your business like a flood or fire?. How does your insurance policy cover changing inventory levels?

Many insurance companies donít cover roof cave-ins due to snow, basement floods due to weather, sewer backups, etc. Make sure you actually read the fine print, and clarify what is actually covered or not. If it says that you are not covered by "acts of god" that generally means that basement floods due to rain, a fire because of lightning, etc., are NOT covered.

03-28-2014, 02:05 PM
Thanks to all who shared information re: insurance. Its a lot to think of and I have to do more research and see what in fact is covered in my home office/garage.

03-31-2014, 04:59 AM
Insurance companies can be very crafty and will always try to find a loophole to avoid compensating you. That's why I've never bothered to insure my business.

Nonetheless if you've invested a lot in your business it's worth taking the risk or risk losing everything with no backup plan if your business was not insured. What I've read here makes me start thinking about insuring my business in the near future. Thanks for the info.

Rebecca Bellantonio
04-17-2019, 01:38 AM
Typically, a standard homeowners insurance policy will include coverage in the event of a fire. "As long as you've been paying your premiums, the standard homeowner's insurance policy covers fire damage to your home, structures on your property, and most of your belongings," reported Darla Mercado of CNBC.

Homeowners insurance policy might not cover the damage related to your professional activity. It is important to check and subscribe to a specific policy which will not cost much, but will cover you in any case.