Whether you have a part-time or full-time job, run
a business from home or simply telecommute a few days a week, there are
insurance-related questions to contemplate. If you are depending on your
renters or homeowners policy to protect your business or business-related
liability incidents, you might be surprised to learn there are limitations to
what a renters or homeowners policy will cover.
Operating a Home-Based
Running a business from your
home means you have different concerns than the employee who simply
telecommutes. Here are a few questions to contemplate.
- Do you keep
business-related stock or inventory in your home?
- Do you have
specialized or difficult-to-replace equipment that requires special
consideration? Many renters or homeowners policies limit office equipment
replacement to $2,500. Would this cover the equipment you need to keep
your business running?
- Do clients
or customers visit your home office? If so, are you protected against
possible lawsuits if a visitor were to injure themselves?
- If your home
office were destroyed by a flood or fire, how would you be compensated for
These are just a few of the
questions you should discuss with your provider. Coverage for business-related
property losses or liability exposures is typically excluded from a traditional
homeowners policy. You may need to consider a business-related endorsement or a
more comprehensive in-home business policy or business owners policy in order
to be fully protected.
Working from home is a benefit
many employers have embraced as they compete to attract and retain quality
employees and provide a satisfying work-life balance. But telecommuting is not
always as simple as having a cell phone, a laptop and high-speed internet.
Concerns about cyberattacks add an additional layer of liability. Verify that
your company will install the necessary software on your home computer to
protect the company's data, and be mindful of your own responsibility with
regard to protecting company information. Telecommuters face similar risk factors
as employees in the office when it comes to work-related injuries and safety
issues. You may want to verify that your employer's workers' compensation
coverage will cross over to your home office.
Have a Conversation
Contact your insurance agent or
company, ask questions and check your coverage to see if there are gaps. A
failure to disclose to your insurance company that you are running a
substantial business out of your home may result in being denied a
business-related claim or a failure to renew your policy. Some professionals
require professional liability insurance or errors and omissions (E&O)
insurance. Don't let your hard work be lost to an accident or oversight. Have a
conversation and make sure you are properly insured.