More than half of small businesses start at home. But the owners don’t realize that their homeowner’s insurance doesn’t fully cover a business in the home, warns the California Society of CPAs.
“Policies differ, but most provide only $2,500 in coverage for equipment… and that coverages drops to $250 if you take that equipment, such as your laptop, away from home,” says spokesman Bill Spaniel. “That’s not much coverage when you consider the cost of today’s home-office technology.”
A home business, like one in an office building or shop, needs specific coverage in a separate policy, including:
- Property to cover loss of structure and equipment
- Liability if a client, employee or vendor is injured at your home office
- Professional liability for some types of busiesses such as an accounting firm
- Product liability in case your product unintentionally injures someone
- Worker’s compensation if you have employees (some cities don’t permit home businesses to have employees on the premises)
“Interview a few insurance agents and choose the one that you feel best understands your business needs and has access to a variety of home-based insurance products,” Spaniel says.
Any suggestions for finding the best deal on home business insurance?