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August 30, 2013

How Home-Based Businesses Work With Home Insurance

Imagine a home business that’s running successfully and growing at a steady pace over the years, then disaster strikes when a client hurts themselves on the property. The business owner assumes that his basic homeowner’s insurance policy covers his liability in the accident, but since it’s business-related, he’s left on the hook for medical bills and lawsuits. Here’s information on how home-based businesses work with the existing homeowner’s insurance policy and when a business owner needs to add business insurance to the home.

Limited Coverage

Some home insurance policies offer limited coverage for business property within the home, but not all insurance does. Plus, the amount that’s covered doesn’t begin to cover most business equipment costs. Liability related to the business is not covered at all, leaving a business owner open to lawsuits and massive medical costs if someone is injured during a business transaction on the property.

Add a Home Business Rider

The most inexpensive option for a home-based business is adding an insurance rider that adds business coverage to a homeowner’s insurance policy. Most are limited in scope, however, and are only appropriate for small scale businesses that don’t have clients coming to the home or other situations that don’t open the business up to a great deal of liability. It is better than having no business coverage, however, and can mean the difference between having to shut down and just being another day at the office.

Purchase Separate Home Business Insurance

If the business carries high value inventory numbers or has expensive equipment or if the owner wants coverage against lawsuits, they can purchase a separate business insurance policy that covers these issues. It’s the more expensive option, but it’s also the one that eliminates a lot of the risk associated with the business. Insurance companies offer various types of business insurance, from in-home business options to business owner insurance. It takes some time to figure out which insurance coverage works best for a particular business. The business owner needs information on their equipment value, lawsuit risks and coverage needs before making this particular decision.

Call ACF Insurance Services Inc at 919-878-7786 today to discuss your home-based Raleigh business insurance needs!

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