Do You Need Business Insurance If You Work from Home?

Running a business from home can save you money on operating costs, but you'll still need some essentials.

If you currently own a home-based business, or you've thought about starting one, it's important to have the right business insurance coverage for your circumstances—even if your business doesn’t require you to have insurance.

Depending on the type of business you own, there are different types of insurance coverage to consider, including:

  • Property Insurance Coverage protects the physical structure where you operate your business, such as your home office space. While your homeowner's policy will likely cover your home in many circumstances, it may not cover your home office if the damage originated from your business. You should either get a separate policy for your business, or make sure your homeowner's policy doesn't have exclusions for business activities conducted within your home.
  • Business Equipment Coverage is a good option to consider for a wide range of home office equipment, from laptop computers to more complex machinery. You can typically get coverage that pays for repairs (with or without a deductible) or provides replacements while your damaged equipment is being repaired. This type of insurance is especially helpful if losing your equipment for any period of time would cause your business to shut down.
  • Business Interruption Coverage protects you and your business against loss of income due to events beyond your control, such as prolonged loss of power due to a natural disaster. This type of coverage will help your home-based business stay afloat until it returns to full functionality. Circumstances will vary, so be sure to discuss your coverage in depth with a trusted insurance agent.
  • General Liability Coverage protects you and your business from third-party injury and damage claims (above and beyond your homeowner's insurance). Consider this: If your client is injured while visiting your home office to discuss business, would you be covered by your homeowner's policy? If you're not sure, it's time to review the specifics of your policy.
  • Professional Liability Coverage is usually required for those who operate within a regulated area of business. Examples include attorneys, doctors, accountants, contractors, engineers, therapists, real estate professionals, and financial planners/brokers. This type of coverage will protect you and your business from potential errors and omissions caused by the service or advice you give as a business professional. If you're required to maintain this type of insurance, it will be outlined by your state when you apply for a business license. Your specific type of professional liability coverage may vary depending on your profession.
  • Business Auto Insurance Coverage is a wise option to explore, especially if you use personal vehicles for business purposes. Many personal auto insurance policies won't cover vehicles against accidents that occur while they're being used for business. So if you park your business vehicle at home—or use personal or business vehicles for your home-based business—just make sure your policy is designed to specifically cover business activities.

In addition to the insurance coverage options listed above, you may find others that apply to your situation. Consider talking with a trusted insurance agent to find the right type of coverage for your home-based business.

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The information provided is not intended to be legal, tax, or financial advice. BB&T hopes you find this information useful but we cannot guarantee that it is accurate, up to date, or appropriate for your situation. Financial calculators are provided to assist you in estimating the approximate costs associated with any bank activity. Your actual costs may vary. You should consult with a qualified attorney or financial advisor to understand how the law applies to your particular circumstances or for financial information specific to your personal or business situation.

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