Do you own a home-based business? If you answered yes, there are a few things that you need to know about how doing so changes your insurance risk. Here are three tips to consider.
Tip #1: Know Your Homeowner’s Policy Doesn’t Include Property Damage Coverage
Many home-based business owners automatically assume that their homeowner’s insurance will cover replacement of sales items in the event of a claim. The truth is that most carriers specifically exclude commercial endeavors when it comes to property damage. This means that if a fire destroys your entire inventory or something else unexpected happens, your claim could be denied and you could have to pay for replacement out-of-pocket. Instead, it is important to take out a separate business policy to ensure total protection.
Tip #2: Understand Your Increased Liability Risk (and Have Proper Coverage)
It is also important to understand that owning a home-based business increases your liability risk. Why? Liability coverage extends far beyond just something happening while a visitor is on your property. Any actions you take while away from home that injure another party—either physically, emotionally, or financially—are considered personal liability. By being out there and taking part in business-related actions, you are increasing the chances of an incident occurring. Again, homeowner’s insurance will not cover anything that happens as part of your home-based business. Thus, it is vital that you have a separate liability policy in force.
Tip #3: Find the Right Coverage for Your Needs
Finding the right coverage for your home-based business is vital. One home-based business representative may only have a few customers, while another may have several hundred. Thus, it is important to speak directly with your agent to find the policy that suits your unique needs and situation.
Ensure your home-based business has adequate coverage. Please contact our team at GTW Insurance today for a no-obligation policy review or quote.