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Make Your Home Office Secure
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Article 7: Insure Your Home-Based Business
The Independent Insurance Agents of America reports that approximately 60 percent of home-based businesses are not properly insured. Expense isn’t the barrier for home business owners. Rather, most think their homeowners’ policies cover their home-based businesses, notes says Jeff Zbar, author of “Safe@Home: Seven Keys to Home Office Security.”
“Depending on the policy and the carrier, homeowner’s umbrella policies do cover some home office equipment,” says Zbar. “But if the equipment is used for business rather than personal purposes, the coverage may be disallowed.”
A typical homeowner’s policy may cover items used for business only up to $2,500, and offers no business-related liability coverage. The simplest solution is to add a business rider to your standard residential policy, but even this provides only limited coverage.
For more comprehensive coverage, consider purchasing a business owner’s policy (BOP). A BOP can be structured to provide coverage for:
Professional and product liability Bodily injury to customers or others visiting your home office Fire Computer hardware and data Property and equipment Business income and accounts receivable
You may be able to purchase a standard BOP policy for as little as $250 a year.
“Talk to an insurance agent about your specific needs and do some online research to determine how much and what kinds of coverage you need,” says Zbar. “This coverage is usually not very expensive, but it can really come in handy if you suffer a loss.”
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