You’re a New Business Start Up – Who needs to take out Insurance…..What do you need to consider?
It’s no secret that many, if not most, new small businesses and start-ups are home based. The days when a “virtual office” sounded new and hip are long past, and it’s practically expected that new enterprises begin as home-based businesses.
It’s a great way to save money while engineering those critical first operations and gaining traction in sales. But is there a difference in insurance for home-based businesses vs. those in a commercial office space?
You may believe that home insurance policies cover home businesses, but they may not – which means that if there’s a fire at your home and it consumes your home office it’s possible none of those office losses would be covered, possibly not even your home if you haven’t alerted your Insurer that you run a business from home!
Using your home for activities your insurer isn’t aware of – like operating a home based business – could invalidate your home insurance policy.
To protect your computer, fax machine, copier, furniture, and printer you may need separate small business insurance. To protect your home, you need to notify your home Insurer that you are running a business from home, and continue cover if that’s even possible.
The same holds for your car or van insurance. Personal motor insurance policies may not cover vehicles used for business purposes, so you may need separate business coverage or to extend your current policy to allow business use.
So what small business coverage might you need?
For those of you running a business from your home, it’s important to work closely with an insurance Broker that understands small business needs and can help navigate the difference between available insurance and what your particular small business needs. You need to make sure you get coverage that’s right for you. Ask yourself these questions to begin getting an idea of what you need:
These questions and others can help identify what types of coverage your home based business needs. As a general rule of thumb, you need Professional Liability (Professional Indemnity) insurance and general Public Liability insurance. Professional Indemnity insurance protects you if your business is sued for negligently providing services, advice, specification, certification or design, even if you haven’t made a mistake.
A general Public Liability policy can protect you against claims of bodily injury (incl. libel and slander claims), damage to other people’s property, and damage to premises rented by you such as a temporary office space or training/conference facilities.
Depending on your circumstances you may want to add a business owner’s combined insurance policy for a home based business.
A business owner’s combined policy (retailers, wholesalers or office) combines general Public & Employers’ Liability coverage together with protection for your business equipment, such as computers, printers, copiers, stock or samples and office furniture.
Whatever coverage you decide to get, be sure to select a business insurance Broker that really understands small business. Some may offer policy discounts for home based businesses in certain professions.
Since you’re home based, in most incidences fewer people will visit your place of work, which lowers your risk of accidents, which may result in lower general liability premiums. The right insurance provider will also offer coverage specific to your profession.
Now that you know you need small business insurance, go out there are get it!
Remember, if you haven’t notified your home insurer that you operate a business from home, do it now. Then contact a reputable Broker who will guide you as to what insurance coverage you DO need!!
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