Is Your Home-based Business Properly Insured?

Running a business from home comes with flexibility, convenience and cost savings—but it also comes with risks many entrepreneurs overlook. If you’re operating a home-based business in California, your homeowners insurance likely doesn’t provide enough coverage to protect your business assets or liabilities.

Homeowners Insurance May Not Be Enough

Most standard homeowners policies exclude business-related claims. This could mean your insurer may not cover the loss if a client slips and falls in your home office or your work equipment is damaged in a fire. The same goes for lost income if a disaster interrupts your operations.

The Type of Coverage You Might Need

The type and level of insurance your home-based business needs depend on what you do. The following are a few key types of coverage to consider:

• Business property insurance—This may protect your business equipment, such as computers, tools or inventory, whether in your home or in transit.

• General liability insurance—This may cover injuries or property damage caused by your business operations. This is especially important if clients or delivery people visit your home.

• Professional liability insurance—Also known as errors and omissions insurance, this may cover you if a client claims your service caused them financial harm.

• Business interruption insurance—This may help replace lost income if a covered event, such as a wildfire or earthquake, disrupts your business.

• Cyber liability insurance—If you store sensitive client data, this may protect you financially in case of a cyberattack or data breach.

Stay Compliant With California Laws

Depending on your business type, you may also be required to carry workers’ compensation insurance—even if you hire only part-time help. And if you use your personal vehicle for deliveries or client meetings, consider commercial auto insurance.

Talk to a Local Insurance Expert

Your business is unique—and so are its insurance needs. Contact Dan Smith Insurance Agency LLC today to find out more.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.