Warning: Your Home Insurance Might Not Cover Your Self Employed Business
Do you run your self employed business from home?
If so, have you considered that your home insurance might not be appropriate for your business? Most domestic insurance policies will not provide cover for a home office and you could find yourself out of pocket if you try and make a claim on a standard home insurance policy.
With an estimated 3.7 million home workers in the UK, the market for insurance specially designed to cover the risks of running a business from home is growing fast. Our guide looks at why you should consider specific home office insurance if you run your company from home.
Building and contents insurance
Many domestic home insurance policies won’t provide cover for business activities. For example if your business includes welding in a home workshop, it may not cover you in the event of fire. Additionally, keeping business stock at home might result in an increased risk of fire and theft and so you may need to increase the sum assured on your policy to take this into account.
You may also find that your expensive business equipment is not covered by a domestic home insurance policy. Research has found that just over half of self employed people spend between £500 and £1,000 on IT equipment every year and your home office may have thousands of pounds worth of expensive electronic equipment.
Your home contents insurance may not provide extensive cover for all your office hardware and software and so you may need specialist cover for your computer equipment, printers, fax machines and scanners.
Public and employee liability insurance
Two further areas where you may have to consider specialist insurance if you are self employed are public and employee liability.
If your business involves clients or other associates visiting your home then you should have public liability insurance. Public liability insurance covers your liability to members of the public for any damage that might occur to their property or to their person arising from your business.
Similarly, if your self employed business employs any staff who are based at your home, you are
required by law to hold employers liability insurance. This type of protection covers you for
any sum which you may be legally liable to pay to one of your employees in respect of injury,
disease, illness or death caused during their employment with you.