It is a fact that home-based business insurance is usually overlooked. The reason for this is that many homeowners feel that their home insurance policy will also cover any of their home-based business activities. Unfortunately, this is not true. Your home insurance can be voided by your home-based business activities.
The obvious question, therefore, is what type of insurance do you need for a home operated business. That is a complicated answer because it will depend on what type of home-based business you are operating. A home-based business may require a variety of insurance types and most insurance companies are now offering home based business insurance policies in addition to a homeowner’s policy.
The first type of insurance from procominsurancecompany.com that you may need is a business property insurance. It is similar to your home insurance policy because it also covers loss, damage, and theft. When you check some of the things that are involved in your home office you may be amazed to know that the contents could easily exceed your homeowner’s policy. Items such as printers, laptops, cell phones, filing cabinets, desks, and so forth could be worth more than a homeowner’s policy would include.
Another type of insurance that may be necessary is general liability insurance. For example, if your uncle is visiting and slips on the sidewalk then your homeowner’s policy will cover all medical expenses and other costs. If a client is visiting your home office and slips on the sidewalk, however, your homeowner’s policy will not cover anything. A general liability coverage for business will provide coverage for all employees and clients. Obviously, the coverage will depend on what type of business you are running.
Business vehicle coverage is a type of insurance for vehicles that are used for business purposes. You will need to have your business vehicle properly insured to cover you, your vehicle, and liability to others. This will be crucial if every you are involved in an accident while doing your business. Another type of coverage is the product liability insurance. This type of insurance is beneficial for any business that is selling a product. It will protect your business from any liabilities that result from a products non-performance or malfunction.
If your business provides services then you may need professional liability insurance. Professional liability insurance will protect both yourself and your clients. For example, a client makes a claim because of your actions as a professional. A professional liability insurance will pay for any lawyer costs and shield your personal assets. If a client suffers damages then this type of policy will compensate him.
There are various types of professional liability insurances for home-based businesses. If you own a massage home business, for instance, and a client sues you for injuries then it will be advisable to have malpractice insurance. Obviously, we think of malpractice insurance for dentists, doctors, and physiotherapists. However, there are many other home-based practitioners including hairdressers, dog groomers, and so forth.
If you own a home-based business that provides professional advice then it will be necessary to purchase an errors and omissions insurance policy. This will protect you against lawsuits from a client who states that they have suffered damages as a result of your advice.
All home business owners should also carry disability insurance. Disability insurance will provide you with income if ever you become disabled or are unable to you on with your business. Another similar type policy is the business interruption insurance which will allow you to receive compensation for lost revenue. The loss in revenue could result from being forced to suspend your business activity due to flood, fire, or disaster.
A business interruption policy can be written alone or you can have it written with your other business insurance policies. It includes both net income and continuing expenses. Net income is for any income that you would have received if there was not a suspension of the business. The net income is based on the net profit before any income tax is subtracted. Continuing expenses are the costs that you must still pay after the suspension. This includes things such as electricity, property taxes, and rent.
There are home businesses that generate income by either selling a product or a service. Other types of home businesses include property rentals. If a landlord is renting a building and it becomes damaged or uninhabitable then the landlord could collect any rental income by having a business interruption insurance policy. There are three options available for this type on insurance including rental value only, business income that includes rental value, and business income other than rental value.
Business income coverage will apply to any income loss that you suffer because of physical damage to the property but the damage property does not need to belong to you. For example, you have a dry-cleaning business in a building that you lease. Your landlord has the building insured and you have all of your commercial property insured.
There is a fire that badly damages the building and forces you to shut down your business for six months. The building is not covered by your business insurance policy but you do have business income loss coverage. Due to the shutdown of your business by a covered peril, the insurance company reimburses you for profits lost. The amount of time that an insurance company must pay you will depend on how long it takes to repair the damage property. This is called the period of restoration.
It should be noted that there is usually a waiting period of typically 72 hours. This means that you will not receive any income during that waiting period. Once the property has been repaired the period of restoration will end. The restoration period may not include additional time to comply with building codes. For example, your dry-cleaning business may not re-open for two weeks because of a new building code application. You will not be covered during that two-week period.
