What you need to know if you have a business based at home

Whether running a part-time, seasonal, or full-time business from home, you’ll want to carefully consider your risks and insurance needs. Starting a business—even at home—can be challenging, and having the right insurance can provide you with a financial safety net and peace of mind.

Your insurance choices should be based on the type of business you operate. For instance, if you’re a sole practitioner home-based accountant, you’ll have very different insurance needs than your neighbor who runs a childcare business. When considering insurance for your business, here are some questions to ask yourself:

  • What type of business do I run? What are the potential risks faced by your type of business?
  • What is the value of my business property? Do you have expensive equipment, such as cameras or commercial printers? Do you stock valuable business inventory, such as gemstones?
  • Does my business have employees?
  • Do customers or contractors visit my business at my home?
  • Do I use my car or other vehicles during my business operations?
  • Does my business store customers’ financial and personal information on a computer or through a cloud computing service?

The answers to these questions will guide which types of insurance to purchase—and how much coverage you’ll need. For your home-based business, the main types of insurance to consider include the following:

Property and Liability Insurance

Depending on the nature of your home-based business, you’ll need insurance to protect the value of your business property from loss due to theft, fire, or other insured perils. You’ll also need liability protection to cover costs if someone is injured due to visiting your business or using your product or service. Your homeowners insurance may provide some protection for your business, but it may not be sufficient. Options for property and liability insurance for home-based businesses include:

  • Adding an “endorsement” to your homeowners policy
  • Stand-alone home-based business insurance policies
  • A Business Owners Policy—or BOP—which combines several types of coverage

Business Vehicle Insurance

Your auto insurance may provide coverage for limited business use of your car. But if your business owns vehicles or your personal vehicle is primarily used for business purposes, you’ll need business vehicle insurance.

Workers Compensation Insurance

If you have employees, you will want to strongly consider purchasing workers compensation insurance to cover costs if an employee is hurt on the job. Workers compensation insurance provides wage replacement and medical benefits to employees injured during employment in exchange for relinquishing the right to sue the employer. In some states, workers compensation insurance is mandatory, so check your state’s workers compensation website for local requirements.

Other types of insurance may be suitable for your home-based business as well. Your insurance professional can help you evaluate your needs and select insurance to meet your budget.

Read Other Blog Posts

Massahusetts DIA Seal

MA Dept of Industrial Accidents New Notice Requirements

The Department of Industrial Accidents (DIA) has revised the Notice to Employees and has established new notice requirements. On or before September 16, 2024, all employers must utilize and repost the revised Notice to Employees poster.
Hacker

Cyber Risk Exposure Scorecard: Assess your risk

Cyber incidents have become increasingly prevalent, impacting organizations of all sizes and industries. As these incidents continue to rise in both cost and frequency, organizations must take steps to address their cyber exposures and bolster their digital security defenses.
Shipping dock

Exposing Double Brokering: Safeguarding Your Freight Against Deceptive Schemes

In the landscape of global commerce, the logistics industry serves as the backbone ensuring that goods reach their destinations efficiently. Yet, amidst the complexities of this intricate network lies a threat known as double brokering, a freight fraud scheme that can leave companies vulnerable to financial loss and operational disruption.
Fireman

The Crucial Role of Disaster Recovery Plans and Insurance Solutions in Protecting Your Business

When preparing for disasters, the significance of comprehensive disaster recovery plans and understanding insurance solutions cannot be overstated. These two pillars serve as crucial safeguards, offering businesses resilience against unforeseen challenges and ensuring continuity in the face of adversity.
Compliance

Compliance Reminders for Businesses

Employers should regularly review their compliance with federal, state, and local employment laws. Here are some areas to keep in mind during 2024.
Covering Losses with Business Interruption Insurance

Covering Losses with Business Interruption Insurance

Standard property insurance provides coverage for physical damage and losses such as fire-damaged furniture or stolen equipment. It assists in covering the expenses associated with rebuilding or replacing damaged property.
Sole Proprietors and Partners Not Always Covered by Workers' Comp

Sole Proprietors and Partners Not Always Covered by Workers’ Comp

Ensure you know the situation: Sole Proprietors and Partnerships must elect proper insurance coverage to safeguard themselves. Don't overlook this crucial protection – it's your livelihood at stake. For other businesses, verify coverage status to avoid potential premium hikes in audits.
Reducing Risks to your Business Vehicles 1200x628

Reducing Risks to your Business Vehicles

Whether you possess a single business car or manage an entire fleet of commercial vehicles, obtaining commercial auto insurance is imperative. Consult with your insurance professional to assess your risks and explore suitable coverage options.
Is Your Business Prepared to Survive a Disaster?

Is Your Business Prepared to Survive a Disaster?

A prepared action plan is vital for business continuity during severe storms that cause power outages and flooding. FEMA reports that 40% of businesses fail to reopen after disasters, emphasizing proactive preparation for financial recovery and operational continuity.

Visit Our Business Insurance Page

Business Insurance

Murphy Insurance stands as your steadfast partner in safeguarding your business from unforeseen challenges in today’s dynamic business landscape. In an era where comprehensive business insurance is not just a prudent choice but a vital one for ensuring the long-term stability and security of your enterprise, we are here to offer our expertise. Running a business inherently entails various risks that can potentially impact your financial stability and reputation. Learn more about our comprehensive business insurance solutions, which are meticulously designed to protect you from these potential threats, granting you peace of mind necessary to focus on the growth and prosperity of your business.