In a word – yes! Just because you own your own home – where you carry out your business – does NOT mean your home insurance covers your business activities. Home based business activities can actually void your home insurance.
What do you need? Depends on what kind of business you’re operating.
You should have contents insurance in addition to the contents/ property insurance for your home insurance. Make an inventory of your equipment and estimate how much it would cost to replace it. Is the equipment in your home all the time? It’s only covered by your homeowner’s policy while it is on your premises. Have a laptop computer or PDA? You’ll need separate contents and property insurance.
You should also have additional general liability insurance. Why? If someone visits your home and falls your homeowner’s policy covers it. If a client falls, it won’t. Seriously consider disability insurance, which will cover lost income if you’re disabled and unable to carry on your business. And business interruption insurance, which covers lost revenue if you’re forced to suspend your business activities because of fire, flood or other disasters.
Do you use your vehicle for business purposes? Then you need your vehicle properly insured for business use to cover damage to your vehicle and liability to others if you’re involved in an accident. Do you sell a product? Consider product liability insurance to protect your business from liability resulting from the product’s nonperformance. Sell a service? You’ll want professional liability insurance to protect you and your clients.
Paid to give professional advice? You need errors and omissions insurance. Do you provide services at client’s sites? You may need completed operations coverage. It protects you from liability that could arise after you have left a client’s premises, when your client starts to use whatever you were working on and injury or damage occurs.
Before you give up in despair, shop around and ask about home-business based insurance package policies. You might find out from talking to your insurer you don’t need all the policies outlined here.
