Home-Based Business Insurance – Why you need it
Why do you need home-based business insurance? Just because your office is in your home, does not mean your home Insurance policy has you covered.
It is now 2016. Millions of Canadian business owners operate their business from their homes. But how many have properly insured their home-based business?
Many assume that losses would be covered under their existing home insurance but the fact is, most policies offer little to no coverage for business related loss. Whether you are a consultant, a yoga instructor, a tutor , a hairdresser , a photographer or a freelance writer or journalist, you should consider home-based business insurance. Of course, the type of coverage and policy you need depends on the nature of your business and how you conduct it.
Tip: Home Insurance typically offers little to no coverage for business related losses
Do you have clients or visitors to your home-based business?
If so, consider the added liability should they injure themselves on a visit to your place of business.
How many people does your business employ?
If you employ more than 1-2 people, home-based business insurance would cover you for added liability for your employees and possible contractors. In some cases, you may need Standard Business Insurance to cover these needs.
What kind of inventory do you keep?
It may be easier to add expensive equipment and inventory to your existing home insurance. However, if you need to insure it separately for business purposes, or have a mix of on-premises and off-premises inventory, you should consider home-based business insurance. A home-based business policy would also insure you against any loses that would interrupt your business for a period.
Are you a consultant that does not relate to any of the previous points?
Even if inventory, employees and visiting clients have nothing to do with your home-based business, you would want to consider Errors and Omissions insurance (otherwise known as Professional Liability Insurance) for coverage of contractual liabilities.
In most cases you would want to consult your insurance broker for advice on the type of insurance that best meets your needs.
An important point to remember is that when conducting business in your home, there is an increased chance of losses. To protect you, your family and your business ensure your home-based business and residence are properly covered.