Finding insurance is one of the basic considerations of starting a business. You are required to take out various insurance policies, depending on the nature of your firm. What does this mean for home-based companies? Turner Little asks: what insurance do you need to run your business from home?
Liability insurance
In a lot of instances, you will be legally required to take out liability insurance. Say something goes wrong while you are conducting business activity from your home and as a result, someone experiences injury or loss. You will need this insurance to cover the legal, medical expenses and compensation from any resulting lawsuits. There are two types of liability insurance.
The first is employer’s liability insurance, which if your business hires staff, you are legally required to take out. This will cover your home-based business if your employees fall ill or get injured while working for you. Situations where you will need employer’s liability insurance range from workplace stress to falling off a ladder while conducting key work-related tasks, so it can prove very useful.
The second is public liability insurance, which you will need if can be injured as a result of your business activities. It protects your firm when members of the general public are compromised or injured as a result of your business’ activity. Let’s say you run a beauty salon from home and a customer is burned by a beauty therapy machine. Public liability insurance would cover your business in this situation.
Professional indemnity insurance
You will also need to take out professional indemnity insurance if you provide advice or treatment form home. For example, if you are a financial adviser and your guidance leads a client to lose income, they can sue you if they believe that you were negligent and this could have been avoided. Professional indemnity insurance would safeguard your firm here, helping you pay any compensation and legal fees, while supplying financial cover for any time you have to spend away from the company.
Home protection insurance
It is always wise to take out insurance policies which are designed for home-owners. Contents insurance, which helps you repair or replace lost, stolen or broken equipment, is vital. This is typically designed for devices like TVs and laptops, but it can also be used to cover specialist business equipment e.g. machines used for commercial cooking. With contents insurance, you will be covered if as a result of this equipment breaking down, you cannot continue working and thus, your business loses revenue.
It is also advisable to take out buildings insurance. This policy covers various elements of your property itself, including its walls, ceilings, roofs, fittings and lights, among many others. Buildings insurance is vital if you have transformed a room in your house into an office, within which you operate your business. You can potentially include this office in your buildings insurance, so if it is damaged, e.g. by fire, your policy may pay for repairs and replacements.
It is advisable also to make sure, when taking out Home Insurance cover, that you tell the Insurer that you are running a business from home. Whilst this may not affect premiums, not doing so could in the event of a claim, enable the Insurer to reject a claim simply on the basis that you had not informed them of all factors when taking out the insurance cover.
Handling business duties
It is key that you receive expert advice when considering what kind of insurance you will need to take out for your home-based business. To access expert guidance, utilise the business and legal advice service retainer available as part of Turner Little’s corporate services. With our guidance, you can ensure that your home-based firm has the insurance it needs to safeguard operations, allowing you to focus on how to make your company a success instead.
Turner Little
Turner Little was founded in 1998 and it has since become a well-established UK based professional Company Registration Agent, Registered Bank Intermediaries and Business Consultants, as well as Trust provider. You can receive our monthly newsletter by signing up using the form below.
