Rolling out of bed just before the start of work. No need for a suit, tie, dress, or skirt. No commute. These are just a few perks of working from your home office. But depending on what you do in your home office and how you do it, you might need to increase your renter’s or homeowners insurance or buy commercial insurance.
What kind of coverage you need working from home depends on whether you’re simply telecommuting as a part-time or full-time employee working remotely, an independent contractor, or a business owner. You may have risks not covered by your home insurance policy as a home-based worker or business owner working out of your home.
You can talk to your rental or home insurer or a commercial insurance agent like Garrett Insurance to learn whether you’re covered for the risks you might face, whether you have enough coverage, whether there are gaps in coverage, and what the cost of commercial insurance could be.
Working From Home for an Employer
As a part-time or full-time employee, you can work from home for a company without having to notify the company that sold you a renter’s or homeowners policy. Your company-owned laptop and cell phone can be claimed under most homeowner policies if lost, damaged, or stolen, and many companies also provide coverage for the equipment you use remotely.
However, your policy might not provide enough coverage for the value of your own equipment used at home. The typical homeowner policy has a limit of $2,500. By talking to your insurer, you might be able to add an endorsement to double this standard coverage to $5,000. Some companies allow a $10,000 limit.
Still, questions remain about a company client visiting your home or a delivery driver. A client or delivery driver who trips on your steps and sustains an injury can file a claim against you. What if you’re injured while working for your company at home?
Your company’s liability insurance might cover the client or delivery driver, and your employer might cover your worker’s compensation claim. However, you should check with your employer to determine what’s covered as a remote employee or whether you need additional insurance.
Operating a Home-Based Business
If you’re self-employed or operating a small business from your home, you have risks that might not be covered under your renter’s or homeowner’s insurance. You can talk to your insurer to find out what kind of coverage you might have and whether there are exclusions.
Here are items and issues your homeowners insurance likely will not cover:
- A loss of business records
- Loss of income from damage to your home office
- Employee injuries
You must purchase a specific type of home business insurance or commercial insurance to cover those issues and other possible risks.
In-Home Business Policy
An in-home business policy can be purchased to provide broader coverage for business equipment and liability, and it may reimburse you for loss of records, accounts receivables, and off-site business equipment. You also might find an in-home business policy that covers loss of income from business interruption.
The broader liability coverage from an in-home business policy usually provides higher coverage limits. For example, such a policy might cover you if you are sued for injuries caused by your products or services.
In-home business policies are available from home insurers and stand-alone insurance carriers specializing in insuring home-based businesses.
Commercial Insurance
Operating a business from home creates risks beyond those you face as a telecommuter, and in-home business insurance might not provide you with the broad limits needed for your business.
You can turn to a commercial insurance agency to find the types of insurance you need to mitigate the risks of your business. Commercial insurance can cover business property and equipment, business data and records, liability, loss of income, and more. Consider these types of commercial insurance for your home-based business:
- General Liability: May cover property and injury claims against you
- Commercial Property: May cover your buildings, inventory, and other commercial property from loss or damage
- Business Owners Policy: A bundling of general liability insurance, property insurance, and other insurance you might need
- Commercial Auto: May cover injuries or damage caused by a work vehicle or damage to the vehicle
- Professional Liability: Can help guard against claims for mismanagement, negligence, faulty work, and more
- Crime: May cover losses from burglary, robbery, employee dishonesty, and other crimes
- Worker’s Compensation: Can cover medical care and lost wages of employees injured on the job and may help shield the company from employee lawsuits
- Cyber Liability: May cover the costs of handling a data breach or cyber attack
- Business Interruption: May help pay for lost wages, business expenses, and relocation costs if your business office is damaged
- Commercial Umbrella: Can provide additional coverage against lawsuits
You can find the right size insurance coverage for your home-based business by talking to a commercial insurance agent.
Find the Commercial Insurance Right for You
The type and amount of insurance you need for your home office depends on how you use your office — whether you are working remotely for a company, working for yourself, or running a business with employees. At Garrett Insurance, we offer a broad range of insurance, including commercial, home, auto, health, life, recreational vehicle, and farm and ranch insurance. Get in touch today to learn more.