Small Business Insurance
Small Business Insurance : Home Based Business Insurance
The notion of a home based business has changed significantly over the last few years, in good part thanks to the opportunities that the internet has provided, and the level of flexibility that working from home offers people.
Types of Home Based Business
A home based business can take many forms.
It can literally be a mix of where you live and premises from where you work.
These can be office type premises or retail/catering/service type premises.
People who do freelance work are often home based, ie photographers, journalist, painters, sculptors etc.
Thanks to sites like elance, many people now do contract work, which can be bid for online, and done by people either full time, or as part time work to supplement another job, or domestic duties.
A significant number of people run internet based ventures from their homes, that may involve more traditional business structures , such as people and traveling, or may simply be a world, where everything is done online.
Equally a significant number of people who are in some type of paid employment, work part of their working week from home.
This is technically different from people taking work home top do in the evenings or weekends, and it is an important difference.
Understanding the nature of what working from home means is important because it can determine quite significantly the type and nature of your insurance needs.
Home based Business Insurance.
The first thing to do is to see if your existing insurers will agree to add an endorsement extending the coverage of your policy to include your business.
They may or may not agree, depending on the nature of your business, but at least you will know where you stand.
In any event it is important that your insurance company knows that you are running a business from home, as this is called a material fact, and could affect your domestic policy,
if you didn’t advise them of the fact. This also applies to your car/auto insurance, whether or not you think it matters.
The nature of insurance means that your insurance company need to know anything that could materially affect the nature of the risk, in order that they can determine if they want to insure it an d at what rates.
This applies when you take the policy out, during the course of the policy id something changes, and at the renewal of the policy.
If your insurers agree to extend coverage, see what they are including by way of public liability, property damage etc, business interruption etc.
If that coverage is not sufficient then consider buying the specific insurance you will need on top of that.
If your Insurers decline to extends coverage, you will need to purchase additional business insurance elsewhere.
In that case it might also be worth considering renting small premises, which may be tax deductible, in order to have a clean and clear separation between your domestic and business arrangements.
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