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The Varied Insurance Needs of Home-Based Businesses

Though it may be difficult to imagine, the U.S. Small Business Administration says that more than half of
all businesses in the U.S. are located out of the home of the business owner. Regrettably, several of
those home-based business owners feel that they don't require any special insurance policies to defend
their business from the liabilities they are exposed to everyday as a normal part of their company's
activity. Some assume that is because their homeowners insurance will protect them while some people
don't realize how vulnerable to liability they truly are.

Comprehending the need for insurance for home-based businesses is critical and, if you want to keep
your business going, is something you should determine before the policy is actually needed. Let's check
out some examples of insurance you should mull over.

Workers Compensation Coverage

If you have employees then you may be forced to have workers compensation insurance. Workers
compensation insurance guarantees that your employees can recover some part of their income if they
can't work as the result of an injury that occurred while on the job. Because you are accountable for
maintaining a safe workplace for your employees, workers compensation insurance protects your
business from being taken to court if an employee were injured while working, so even if your company is
small enough that you are not legally required to carry it, it is still an important coverage to consider
having.

General Liability Insurance


If a client or customer were to amble into your office, your business would be responsible for any injuries
they obtained. Likewise with employees who work out of your home with you. Your company could even
be liable if a delivery person with a package for your company were injured while delivering it. It is
important to acknowledge here that your business is liable for these injuries. Of course, that really means
that you are liable-but not on a personal level. Your home insurance covers the personal liabilities you
have when a friend or guest is hurt in your home. But most homeowners policies exclude those liabilities
related to the operation of a home-based business. A business liability policy (also called a general
liability policy) can be obtained separately in order to provide enough liability protection. In some
instances, endorsements can be added to your homeowners insurance policy to allow it to cover these
business liabilities.

Commercial Property Insurance


If your home is burglarized and your personal items are taken, then your homeowners policy will generally
re-compensate you for your losses. But if your business articles are stolen from your home it is doubtful
that the homeowners insurance policy will cover their loss unless you've had that particular provision built
into the policy. Instead, a commercial property insurance policy that protects your business property is in
order.

Professional Liability

Depending on the profession you work in, you might need a professional liability policy. These policies
protect you against liabilities specifically encountered by individuals working in your profession. That can
include errors and omissions insurance for those in the financial industry, malpractice insurance for those
in the medical field, or the more generalized professional liability insurance.

Insurance is a product that is created to protect your finances from the fallout of risk exposure.
Regrettably, it can't protect you from the actual risks you run into. As a business owner, you deal with risk
everyday and you expose yourself to liabilities that you may not be able to offer financial recompense for,
unless you have the protection of insurance on your side. Don't let the destiny of your business rest on
chance and hope; get the appropriate insurance coverage and help ensure that you are constructing a
financial foundation that allows you to carry out all your business objectives.
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