What Insurance Do I Need to Run a Business From Home?

First of all – thank you for asking this question! Second – let’s get to the bottom of it. So, you are working from home – maybe running an Etsy shop from your kitchen table, baking cupcakes, or running a virtual assistant agency from your spare bedroom. Amazing! Welcome to the world of pajama meetings and lunch breaks in your own kitchen.

But here’s a not-so-fun fact: your Homeowners, Condo, or Renters insurance probably doesn’t cover most of your business activities. Shocking, I know. Just because your business lives under your roof doesn’t mean your Home policy protects it.

Let’s go over the key types of home business insurance coverage you actually need to protect both your business and your home-sweet-home hustle.

Your Homeowners policy is great for your personal belongings but usually excludes business-related stuff. So, if your fancy laser printer, specialized tools, or inventory gets damaged or stolen, your claim could be denied. Unless you’re just emailing from a laptop and calling it a day – you need more coverage.

A Business Owners Policy (BOP) or an endorsement on your Homeowners insurance is usually the foundation of solid home business insurance coverage. But once you have equipment, clients visiting, inventory, or revenue to protect – it’s time to upgrade.

Whether it’s high-end video equipment, baking mixers, or a stack of designer handbags you’re reselling, your gear needs to be covered. Standard Homeowners insurance often limits coverage for business property (typically to $2,500 or less).

Business Property Insurance or a Business Owners Policy (BOP) can help protect:

• Your equipment
• Inventory
• Business-specific tools and tech
• Furniture used for your business (yes, even that cute pink desk)

Let’s say there’s a fire in your garage, and you can’t run your business for a few weeks. Or your entire stock gets stolen. Cue the panic.

This is where Business Interruption Insurance comes to the rescue. It covers the lost income while your business is temporarily out of commission due to a covered event – like a fire, storm, or theft. It can also help with temporary relocation costs if needed. It’s like the safety net you didn’t know you needed until… well, you do.

Do you store personal information – like customer names, addresses, credit card info, or medical data?

A Data Breach or Cyber Liability policy is your digital bodyguard. If there is a hack or security breach, this insurance can cover:

• Legal fees
• Notification costs
• Credit monitoring for affected customers
• Public relations costs to help fix your rep

Bottom line: if your business touches sensitive data, this coverage should be in your arsenal.

If you are using your personal car for business errands – delivering products, meeting clients, or picking up supplies – your Personal Auto policy may not cover you in case of an accident.

That’s right. Your personal policy might give you the cold shoulder if you get into a fender-bender while hauling cupcakes to a customer event. A Commercial Auto Insurance policy steps in to cover business-related driving. Depending on your needs, you can even select a policy that covers both personal and business use.

Even if you only have one part-time helper – or your cousin occasionally lends a hand packing orders – Workers’ Compensation Insurance is a must. If they get hurt while working for you, your Homeowners policy won’t pay their medical bills or lost wages. But Workers’ Comp will.

Besides being the right thing to do, it’s also legally required in most states if you have employees (yes, even if they’re just part-time). Don’t skip this insurance.

Running a business from home is empowering, flexible, and exciting – but it also comes with risks that your Home insurance won’t cover. The good news? With the right coverage in place, you can build your dream business without losing sleep over “what-ifs.”
So go ahead, keep conquering the business world in your yoga pants. Just make sure your business is as protected as your morning coffee ritual.
And if you need help figuring out the right coverage? You already know who to call – your favorite insurance brokers (that’s us!).