Q&A: The blurry line between home and business insurance
I’m planning to move my small business into my home. Do I need business insurance or will my current home insurance suffice?
The ability to work from home is one of the benefits of living in a modern world. But believe it or not, as a home business owner you may be exposing yourself to risks that are not covered by your home insurance policy.
When an insurance policy is underwritten, all the risks that the proposed insured presents are evaluated and the policy is issued and priced accordingly.
So unless you disclose to your home insurance company that you are running a business out of your home and they add coverage for the liabilities associated with that in your policy, then claims that occur and affect your home office may not be covered. In that case, you may need a separate business insurance policy.
Even if you do let them know and they add wording to the policy that covers your business property in the event of an insurable incident, that does not mean that your business is completely covered.
Business liabilities can affect the work you do and not the stuff you own, so coverage of them might require professional liability policies such as errors and omissions insurance. When you compare insurance quotes, make sure you give the company the full story of your home business so that you can get quotes that are accurate for your situation.
See also: Business insurance basics
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