Homeowners insurance protects your home, personal belongings and personal liability. However, business activities can create risks that a standard homeowners policy may not cover.
For example, your policy may limit coverage for computers, equipment, supplies or inventory that you use for your business. If a fire, theft or another covered event damages those items, your homeowners coverage may not provide enough protection.
Consider Who Visits Your Home
Do customers, clients or delivery drivers regularly visit your home for business purposes? If so, you may face additional liability risks.
If a customer visits your home for a business appointment and gets injured, your homeowners policy may exclude or limit coverage for a business-related liability claim. The right business liability coverage can help protect you from these situations.
Think About Your Business Equipment
Take inventory of everything you use to operate your business. This could include computers, printers, specialized equipment, tools, supplies and inventory.
The value can add up quickly. If your homeowners policy limits coverage for business property, you could end up paying a significant amount out of pocket after a loss.
What Insurance Does a Home-Based Business Need?
The right coverage depends on your business and the risks you face. Some small home-based businesses may qualify for an endorsement that adds coverage to an existing homeowners policy. Other businesses may need a separate business policy.
A business owners policy, commonly called a BOP, can combine property and liability coverage. Depending on your operations, you may also want to consider coverage such as cyber insurance, professional liability or commercial auto insurance.
Protect Your Home and Your Business
Working from home doesn’t automatically mean your homeowners policy covers your business. As your business grows, your insurance needs can change too.
Talk with your insurance agent about how you operate your business, what equipment you use and whether customers visit your home. Your agent can help identify potential gaps and recommend coverage that fits your situation.