Question: How do I insure a home based business?

Answer: With the recent economic downturn, the internet and other technology advancements, more and more people are running home based businesses. Most people assume that their home based business is covered by their homeowner’s policy. In almost every case, this is not correct.

Most people feel that they have no exposure because clients don’t step foot on their premises so slips and falls don’t occur. But in reality, many claims occur far away from your premises. If you falsely advertized something, or said something that was slanderous or libelous, it probably wouldn’t occur on your premises. Or what if you were driving your personal car or a rental car on business and injured someone or something? Your auto policy is usually in your name, and may not respond to claims against your business name. How would you be covered for these damages?

Another issue is your lost revenue after your home is destroyed in a fire or hurricane. How would you recover your lost income and pay for the extra expenses you might need to run your business from a rented space and replace your business property such as computers, phones, faxes, etc?

The answer to many of the above scenarios is to purchase a business owners policy (BOP) in your company’s name. A BOP can cover all the above exposures and more. If your business involves giving any sort of professional or consulting advice, you may also need a professional liability policy, also known as an E&O policy (errors and omission).

Please call your Lutgert Insurance agent to discuss the insurance needs for your home based business.


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