By Niraj Mamtora
•
11 Oct, 2022
Having a home based business is a brilliant move, it saves you money on a costly office/work space, it allows you to work odd hours with peace and quiet (hopefully) and saves stress and money on commuting. Many entrepreneurs, start-up businesses or side hustles operate from home, but how does this impact your home insurance? Running a business from home can also increase the level of risk to your property and your contents, which is why you need to make sure you have the right business at home insurance in place. What additional risks are there when running a business at home? It will largely depend on the type of business you run and the types of activities you are undertaking, but essentially running a business from home will increase the risk of loss occurring to your buildings and contents. Some of the elements you need to consider when running your business from home are below Stock If you run a business that requires you to hold stock at your home, this can put your property at increased risk of a break-in and theft. It will also increase the amount an insurer would have to pay out in the event of a fire or flood, and the resulting damage to any stock. Your insurer would need to know if you hold stock at the premises as this is not covered under standard contents insurance. Business Equipment Again, you may have expensive or additional equipment you use for your business such as desktop computers, laptops or specialist machinery. Your insurer will need to know about any computers, laptops, or specialist machinery you have at home in the event that they need replacing due to loss or damage. Usually, if you’re just performing a clerical role from your home with a laptop/PC that doesn’t impact your home insurance. Just make sure these items are covered by the employer’s business insurance – this will avoid hefty replacement/repair costs for a cracked screen, or if you spill a drink on your keyboard. Public Liability If you run the type of business that has customers or suppliers visiting, there is an increased risk of someone injuring themselves at your property. The more visitors, the greater this risk becomes. Accidents or injuries to members of the public while at your property could result in liability claims and would only be covered if you have the correct insurance in place. It is advisable for your business to have its own public liability cover in place, as home insurance providers will often ask you to confirm you have this covered. Your home insurance will likely have limitations, exclusions or conditions will often apply within the home insurance policy. What information will I have to provide to get a quote? The first step to purchasing home business home insurance is to get in touch with a specialist home insurance provider. What kind of business do you run and what it involves? For example, are you doing clerical work or production e.g. making curtains? What equipment do you use, such as a laptop, machinery or specialist equipment If you hold stock in your home and its value If you have business visitors, such as customers or suppliers, and the frequency of those visits If you have a separate business liability policy in place How much is home business home insurance? There is no clear answer for what you’ll be paying, but this is good news! As the risk factors vary between the nature of the work, business equipment, stock and if you have visitors your insurance cover will be tailored to your unique circumstances. This means you’ll be correctly covered and not overpaying for your insurance. What is not covered? As home business home insurance is not the same as business insurance, there are a few covers which will not be covered: Public Liability Insurance Public liability insurance protects your business against compensation claims and their legal costs if you cause injury (including death) to a third party or damage to their property. Public liability insurance covers you on your premises and working off-site. Professional Indemnity Insurance Professional Indemnity Insurance provides cover for legal costs and expenses incurred in your defence, as well as any damages or costs that may be awarded if you’re alleged to have provided inadequate advice, services or designs that cause your client to lose money. Employer’s Liability Insurance This cover is compulsory if you have any employees (including any volunteers or apprentices). This is to ensure you can meet the costs of compensation for your employees’ injuries or illnesses, whether caused on or off-site. What’s Next? By now you will know if your home insurance is impacted by you running a business from home. Your next point of call will be to find an experienced insurance broker to provide you with the right advice on what types and cover you should have. Luckily you can contact your Forum Insurance account executive, email at info@foruminsurance.com or call us on 0208 909 2899 . We will then search the insurance market so you don’t have to, this secures you the best cover, policy wording and insurance premium.