Protecting Your Home-Based Business

May 10, 2016

According to the U.S. Small Business Administration more than half of America’s businesses are home-based.  But setting up headquarters in your home doesn’t mean your homeowners insurance will adequately protect your operation.


A typical homeowners policy provides about $2,500 of coverage. That usually will cover equipment, but it won’t offer liability protection or cover you for lost data or income.


Do your research to protect yourself and your home business. Make sure you have the right type and amount of insurance coverage.


In general, home-based business owners have three basic options:

  • Homeowners policy endorsement: This is added to a homeowners policy to increase coverage on business equipment. There also may be the option to buy a homeowners liability endorsement for protection in the event someone—say, a delivery person—is injured on your property.
  •  In-home business policy: An in-home business policy provides more comprehensive coverage for business equipment and liability than a homeowners policy endorsement. These policies, which may also be called in-home business endorsements, vary significantly depending on the insurer.
  • Business owners policy: Also called a BOP, this plan offers the most comprehensive coverage for small- and mid-size businesses. It protects against many of the same things that in-home business policies do, but offers even more coverage.

As always, if you are not sure you are adequately protected or have questions about your policy, please contact your agent.

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