Many homeowners operate a business or work out of their homes. Most of them are under the impression that their home insurance will cover everything in their house, including their business. Even though the home insurance policy covers damage within and off premises to a certain extent, the policy will not cover all the needs of a home based business. Only a complete home business insurance policy can give complete assurance to those who work from home.
Home based businesses differ on many fronts. The needs of those who sell products differ from those who offer services from home. Hence, providers offer different types of home business insurance policies. Some have a predetermined package, some offer a customized package and some offer both the options.
A home business needs some basic coverage elements including public liability, professional indemnity, building, contents, fire, burglary, general property off home, business money, business vehicles, relocation and personal injury or illness. As additional coverage options, you can add glass breakage, tax audit, business interruption, errors and omissions, malpractice, completed operations, employee theft and dishonesty or fraud, equipment/machinery breakdown, electronic equipment and more.
If the business involves offering advice to customers, then professional indemnity coverage is important for a home business. If your work or the information you provided is faulty, the clients can hold you responsible for the loss (financial or otherwise) they suffer. Professional indemnity coverage protects you against these litigations.
If your work involves coming in contact with the public, you need coverage against any injury or damage your work might cause the public. Such liabilities (including medical and legal) are very expensive, so public liability coverage is very important.
Your workplace (your home) will be covered against any damage due to covered risks including fire, storm, floods, theft, etc. Even though this coverage protects your business building (home), it does not cover the personal contents in your home.