It may be hard to believe that the U.S. Small Business Administration reported that more than 50 percent of all businesses in the U.S. are based out of the business owner’s home. Unfortunately, many of those home-based business owners believe that they don’t need certain insurance policies to protect their business from liabilities they are exposed to daily. Some believe their homeowners insurance will cover them, while others don’t understand how exposed to liability they really are.
Understanding the need for insurance for home-based businesses is important and, if you want to keep your business running, is something you should figure out before you coverage is actually needed. Let’s take a look at some of the types of business insurance you should consider.
Commercial Property Insurance
If your home is broken into and your personal items are stolen, then your homeowners policy will generally reimburse you for your losses. But if your business items are stolen from your home it is unlikely that the homeowners insurance policy will cover their loss unless you’ve had that specific detail built into the policy. Instead, a commercial property insurance policy that covers your business property is in order.
General Liability Insurance
If a client or customer were to walk onto your property, your business would be liable for any injuries they obtained. Likewise with employees who work out of your home with you. Your business could even be liable if a delivery person with a package for your company were injured while delivering it. It is important to note 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 homeowners insurance covers the personal liabilities you have when a friend or guest is injured in your home. But most homeowners policies exclude those liabilities connected to the operation of a home-based business. A business liability policy (also called a general liability policy) can be purchased separately in order to provide adequate liability protection. In some cases, endorsements can be added to your homeowners insurance policy to allow it to cover these business liabilities.
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 designed to protect your finances from the fallout of risk exposure. Unfortunately, it can’t protect you from the actual risks you encounter. As a business owner, you deal with risk on a daily basis and you expose yourself to liabilities that you may not be able to offer financial recompense for, unless you have the benefit of insurance backing you up. Don’t let the fate of your business rest on luck and hope; get the right insurance coverage and help ensure that you are creating a financial foundation that allows you to achieve all your business goals.
Workers Compensation Coverage
If you have employees then you may be required to carry workers compensation insurance. Workers compensation insurance ensures that your employees can retain some portion of their income if they are unable to work as the result of an injury obtained while on the job. Because you are responsible for providing a safe environment for your employees, workers compensation insurance protects your business from being sued if an employee were hurt while working, so even if your company is small enough that you are not legally required to carry it, it is still a valuable coverage to consider having.
We are a family owned and operated Independent Insurance agency, located in Alton, NH. Call us today for a New Hampshire business insurance quote at (603) 875-1200.