Are you running a part-time, seasonal or full-time business from your home? If you are, then you should carefully consider your risks and insurance protection needs. Starting any business, home-based or otherwise, is always a challenging undertaking, and having the right insurance can give you a financial safety net and the peace of mind that goes with it.
Of course, your insurance choices will be based on the type of business you operate. If you’re a self-employed home-based accountant, your insurance needs will be very different from those of your neighbor who runs a childcare business.
When considering insurance for your business, here are some questions to ask yourself:
- Business type – What are the potential risks involved in your type of business?
- Business property value – Do you have expensive equipment, such as cameras, servers, or commercial printers? What is the value of your inventory?
- Employees – Do I need to insure my employees?
- Customers or contractors – Do you have business related visitors to your home?
- Vehicles – Do you use any vehicles for business purposes?
- Data storage — Does your business store customers’ financial and personal information on a computer or through a cloud computing service?
Your answers to these questions will determine which types of insurance you’ll want to purchase and how much coverage you’ll need. Here are three main types of insurance to consider for your home-based business.
Property and Liability Insurance
Depending on the nature of your home-based business, you’ll need insurance to protect the value of your business property from loss due to theft, fire or other insurable risks. You will also need liability protection to cover costs if someone is injured as a result of visiting your business or using your product or service. Your homeowner’s insurance may provide some protection for your business, but it may not provide sufficient coverage, or protect you from all risks involved in doing business from your home. Ask your agent about:
- Adding an “endorsement” to your homeowner’s policy
- Stand-alone home-based business insurance policies
- A Business Owners Policy that combines several types of coverage
Business Vehicle Insurance
Your personal auto insurance probably provides coverage for limited business use of your car. But if your business owns vehicles, or the primary use of your personal vehicle is business, you will need to purchase business vehicle insurance.
Workers’ Compensation Insurance
If your business has employees, you should consider purchasing workers’ compensation insurance to cover costs if an employee is hurt on the job. Workers compensation insurance will provide wage replacement and medical benefits to employees injured in the course of employment, in exchange for relinquishing the right to sue you, the employer. This is invaluable protection. With few exceptions, every employer in the State of Maryland with one or more employees is required by law to provide workers’ compensation coverage for their employees. Neither employer nor employee can waive provisions of the Workers’ Compensation Law.
Other types of insurance may be suitable for your home-based business as well. Your insurance professionals at Freedom Insurance Agency can help you evaluate your needs and help you select insurance to meet your budget. Call today for your free consultation!
Freedom Insurance Agency