A common misconception regarding home business insurance is assuming your home-based business is safe under homeowners’ insurance. This couldn’t be further from the truth.
What’s more, if you try to file a homeowners’ claim sustained by an undisclosed home-based business, your insurer may refuse to cover it or even cancel your policy.
So how can a home business owner protect protect their business? Start by insuring right away!
Listed are 10 tips for finding home business insurance right for you:
1. A One-Person Business is Eligible for a Rider Add-On
A “rider” is one of the most inexpensive ways to satisfy your home business insurance needs. Riders increase a policy’s coverage in exchange for increased premiums. And you can get a rider designed to add limited business coverage to a homeowners or renters’ policy.
While riders are not suitable for every home business they work great for one-person businesses without a lot of valuable equipment or business related visitors. While the price of riders is a major benefit factor, they aren’t the best choice if your home business requires a lot of business related traffic in and out of your home.
2. Consider an In-home Business Policy
Any serious home-based business owner should consider purchasing, at least, an in-home policy business policy. In home policies can potentially cover up to 10,000 in losses. Home business policies offer a much broader coverage than riders, including:
- Coverage for Lost Documents
- Theft of Funds
- Coverage for as Many as Three Employees
- Business Equipment
3. You Can Purchase a Business Owner Policy for Home Business Insurance
This site goes into depth about Business Owner Policies. If your assets are worth more than 10,000, a Business Owners Policy is highly recommended. A Business Owners policy protects a higher amount of loss than a rider add-on or an in-home business policy.
4. Discuss an Errors and Omissions Policy with Your Agent
If you are in a business of providing professional advice to a client and the client were to a mistake that cost them money based on your advice, the client could then file a lawsuit against you. An Errors and Omissions policy, also known as a Professional Liability Policy, protects you from from paying money out of your pocket to settle the claim or defend against it.
5. Find an Agent or Broker Who Will Understands Your Business
It is great to always seek advice when you are concerned about acquiring adequate coverage for your business. The best way to start is by speaking to a professional who can help guide you in the right direction.
6. You May Need to Get a Commercial Auto Insurance Policy
Running an in home business means you will be using your vehicle, at least occasionally, for business purposes. Be aware, while driving your car for business, if you are involved in an accident, your insurance company has the right to deny your claim. If you feel you may need commercial auto insurance, talk to your agent about a commercial package policy, where you can combine all your insurance needs into one, keeping your premiums lower.
7. Find Ways to Keep your Premium Lower
By doing the following you can reduce the possibility of claims, as well as, receive possible discounts:
- Install a Computer Back-up System
- Install Smoke Detectors
- Install a Security System
- Keep Sidewalks and Steps Clean and Sturdy
8. Increase Coverages as your Business Grows
As you get closer to your renewal, it is a great time time to review your coverages and your business. While a rider might suffice when your business first starts out, as your business grows, your coverage might need to too.
9. Make a Checklist
The best way to know how much insurance coverage you are needing is by making a check list of everything you need to insure, as well as, reviewing possible risks. When making your list make sure to include:
- Business Contents
- Business Equipment
- Separate Premises and/or Rental Accommodations
10. Don’t Forget Liability Insurance
Something as simple as the UPS man slipping on your door step can turn into a legal disaster if you don’t have adequate liability insurance coverage.
As a business owner, you will face tough challenges every day, adequate business insurance protections shouldn’t be one of them. Austinsurance understands the importance of your business and will work hard to provide the perfect business insurance specifically for you.