A home-based business certainly has its benefits and advantages – no commute, less stress and more time with the kids. However, nearly 40% of self-employed people are uninsured, according to the Independent Insurance Agents of America . In addition, they may be breaking the law as a result. Here is what you should know about coverage if you are self-employed or work for a home-based business:
Personal insurance policies do not cover a home-based business. While a typical homeowner’sinsurance policy protects up to $2,500 worth of damages on the premises, it does not include liability insurance, which is critical for a business. According to the AXA, only 3% of home-based business owners have general liability insurance, which covers the business in case anyone falls or gets injured on or around the premises. Furthermore, they found that 66% ofhome-business owners use their cars for business purposes but do not have business auto insurance. In both cases, the owner technically is operating illegally.
Endorsements: You may be able to get an endorsement on your existing homeowner’s policy depending on your type of business. This extension of coverage means having higher limits that cover certain perils. In addition, an endorsement enables you to double your policy to include business equipment.
Homesite provides a list of specific endorsements.
Business property insurance: This type of insurance protects against loss or damages done to property used to operate the business, such as fax machines and copiers. About.com details the types of business property insurance available.
In-home business policy: As the number of home-based businesses has grown, the insurance industry developed protection to extend beyond business property. If your business is shut down because of damages to the home, this policy covers lost income and payroll expenses for up to a year.
Ehow helps you determine if an in-home business policy is right for you.
As your home-based business grows, you may need coverage that your business insurance policies do not cover, such as life insurance and workers’ compensation. Additionally, if you are looking to improve your home office area, Entrepreneur and Freshome can help. Or, if you interested in advertising for your home-based business, visit Shopin Boston.
Vargas & Vargas Insurance is here to help you meet your business insurance needs. For more information, call 877-550-0025 and speak with one of their dedicated agents today.
