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Business Protection Bulletin


By September 1, 2013No Comments

Home-based businesses offer entrepreneurs significant cost savings, such as eliminating the expense of commercial space and commuting. However, when it comes to buying insurance, too many of these owners are short-changing themselves – and putting their investment at risk.

A recent survey by the Independent Insurance Agents & Brokers of America (IIABA) found that nearly 60% of the nation’s 11 million home-based businesses don’t have insurance. Of those entrepreneurs, nearly 40% thought that their Homeowners policy protects them from business-related risks, while almost 30% said their businesses were too small to insure.

According to IIABA Vice President of Education and Research Madelyn Flannagan, home-based business owners face significant financial losses from theft, accidental damage, natural disasters, vehicle accidents, and liability (for example, if an employee is injured on the job). Homeowners insurance usually does not cover these risks, warns Flanagan.

To protect your home-based business, IIABA offers these guidelines:

Review your Homeowners policy. Coverage for certain business items is limited and does not provide Liability insurance for home-based businesses. What’s more, the standard Homeowners policy does not include Business Interruption coverage, which reimburses you if a loss causes your home business to cease operations. However, you might be able to add these coverages to your policy by endorsement.

Consider business insurance. You have several options including an Incidental Business Endorsement, a business owners package (BOP) or an In-Home Business Owners policy.

Protect yourself. If your home-based business is a full-time occupation, you need Life, Health, and Disability insurance, as well as Workers Compensation.

The bottom line: An investment in insurance can provide security and peace of mind as your home-based business grows.

For more information, feel free to get in touch with us at any time.