Do I Need Business Insurance if I Work from Home?
These days it seems like everyone has a side job, that’s because 29% of workers have some sort of side hustle; especially millennials-where 44% of 25-34 year-olds report having a side gig.
Being your own boss, setting your own hours, calling the shots, and setting your own rates comes with many advantages. Most people are so busy growing their small business though that they don’t think about the risks.
It’s important to get the right coverage for whatever work you’re doing. For example, you could be on the hook for expenses if you get into a car accident on the way to pick up a passenger while driving for a ridesharing service or if you are the victim of theft when your in-home stock of LipSense goes missing.
What type of coverage should you get for your small business?
- Rider to a homeowner’s or renter’s insurance policy
This is the most inexpensive home-based business insurance. It is an add-on or rider that expands a homeowner’s or renter’s policy to cover the company. The cost is usually minimal around $100 a year with about $2,500 of additional coverage for business property and may provide some liability coverage.
This type of insurance may be appropriate for a one-person business without many business-related visitors or valuable equipment. For example, such coverage may work well for a Pampered Chef distributor or IT Works working from home.
- In-home business policy
These policies cover a broader range of contingencies, including theft of funds being taken to the bank for deposit or loss of critical documents. The plan usually covers up to 3 employees against theft.
The cost often ranges from $250-500 and can cover as much as $10,000 in losses. It covers business equipment and liability for injury, which is important if people are coming in and out of your house for business purposes.
- Business owner’s policy
Entrepreneurs who need more than 10,000 of coverage should pay for a business owner’s policy. Coverage by this type of plan includes damage to or loss of business equipment and other assets, loss of critical records, liability for customer injuries, loss of income or a business interruption in case of power outage from lightning storm or natural disaster, other flood. Such a policy might also protect you if you asked an employee to run to the store and buy you stamps and they are in an accident.
Many BOP’s start at around $500 and offer coverage up to $4 million. For those really taking their business seriously, this is probably your best option.
Knowing what coverage is right for you and your side hustle is important. If you have any questions, need some extra guidance or would like to start your own policy, give us a call.
-AZ Insurance Team