When you run a home-based business, business insurance is often last on your mind. However, keep in mind that while a homeowner's insurance might offer some coverage, it should not be the only policy you have. You need to be sure to protect business-related assets and inventory as well. Here are some insurance policies to be sure you have for your home business.
Renter's or Homeowner's Insurance
You should begin with your basic home policy, whether you rent or own your home. You need to speak to your insurance company to find out exactly what it covers. Many policies require you to get an add-on policy in order to cover certain aspects of your home-based business, such as a rider add-on. This will give you an expansion on how much is covered. For example, the add-on to your homeowner's insurance policy may not include injuries to people visiting your detached office in your backyard that you use for your business, or for the inventory kept in your outdoor shed.
Many home policies, whether for renting or owning a home, do not include coverage for floods unless you choose an add-on. Make sure you have adequate flood insurance on its own or along with your renter's or homeowner's insurance policy. This is important for any residence, but also for your at-home business. If there is a major flood that affects your office, it can destroy our computer and electronic equipment, damage all the papers and files not in filing cabinets, and do damage to your inventory if it was set up in the office. This is a major loss that would be difficult to recover from if you weren't insured.
If you have any employees that work for you in your home business, such as an accountant or assistant, they need to be covered by a workers' compensation insurance policy. This is for employees who are on salary that get a paycheck from you on a regular basis, not contract employees. Employees that are actually independent contractors are not considered on your payroll, so the rules are different. You can contact your local labour office if you are not sure whether this is required. For your employees with workers' compensation, their injuries are covered when they occur on-the-job. This can also prevent them from suing you for damages.
Contact an business insurance agent if you're curious about other policies for your home-based business.