lawncare home business

home business pic

homebusiness2

 

There are over 30,000,000 home based businesses in the United States.1  These people are brave, creative, and doers that make a difference in the lives around us.  Often they are leaders and engage life in a way most of us just do not.  They transform industries, communities, and inspire many of us to pursue life to the fullest.

We admire and applaud them because they do what they love and have freedoms that many of us just do not have.  Yet they also take on immense risk to pursue their passions.

60 percent of home based businesses do not have insurance.2  Of these businesses many think they are covered on their homeowners or personal auto insurance.  While naturally risk tolerant many of these businesses needlessly accept risk and/or may not fully realize some of the legal risks they have as they run their ventures.

Home based business can be held responsible for significant financial loss.

Some common phrases we’ve heard home based businesses say…

“If something happens I’ll just hire a lawyer.”

“I’m a very careful driver so that won’t happen to me.”

“My product can’t injure anyone.”

“I’ll just shut down my business.”

“I’m not worried about losing my inventory.”

Some of these statements are certainly acceptable and some are misguided, yet when the unexpected happens their responsibilities are often greater than they thought.

Understand what’s at stake.  The goal is your continued success.

If you are running a home based business here are some considerations:

  • Business property – Business stock or equipment
    • Your homeowners insurance may only cover a small portion, if any.
  • Delivery of goods – Driving to a job-site or delivering product
    • Auto insurance must be specifically crafted to cover this.
  • Business premises exposure – A client injured at your home
    • Customers injure themselves often – they fall down stairs, slip on ice, etc.
  • Products liability – Your product causes injury, illness, or other bodily injury or property damage
    • Ever seen a video of a child with an eraser stuck up their nose?  Adults are worse.  Even their mishandling of your product can come back to haunt you.
  • Employee injury – Be aware of workers compensation laws and regulations
    • With a few exceptions workers compensation insurance is required by law
  • Contractor hustle – Side hustle or full time gig
    • Let’s say you have an electrical side hustle and you are the alleged cause of a fire that burns down a house. The homeowners insurance company can lawyer up and demand reimbursement.
  • Professional Services – Bookkeepers, consultants, digital experts, etc
    • Your alleged or actual error in your professional work may cause financial loss to a client and they can seek recourse.

Whether you run a formal or informal business out of your home you are subject to legal and financial risk in which you are responsible.  Even if you are incorporated, LLC, or acting as a sole proprietor there are specific business related exclusions in both home and auto policies that must be accounted for.  Some personal lines insurance carriers have specific carve-backs available for certain situations so be sure to talk with your agent about your business.

Jeremy Hyde | Colligan & Company

1 www.sba.gov
2 www.icrsurvey.com


Small Business Insurance | Home Based Business Insurance | Entrepreneur

Colligan Black and White Logo

Categories

Archives

About the Author: Jeremy Hyde

Christian, MK/PK, Brother, Husband of a magnificent wife, Father of three sons and two daughters, Insurance dork, Sports and Racing fan, Competitor, Coach, Early riser, Grill-man, Yearner of sand dunes and Lake Michigan, Owner of a Yorkie named Gerald, Wannabe basketball player, Reluctant handyman, Car enthusiast, Admirer of passion and excellence and design...

Share This Story!

22 Comments

  1. Tom Blee December 26, 2019 at 4:37 am - Reply

    I like your insurance based website

  2. Denny January 24, 2020 at 8:12 pm - Reply

    This type of blog on insurance for home business is needed!

  3. Myles February 26, 2020 at 7:29 am - Reply

    Great post, very informative on home insurance. I wonder why the other experts do not talk about this. You should continue your writing. There are a lot of home based businesses in Fort Wayne that could use this.

  4. Billy L April 14, 2020 at 12:07 pm - Reply

    I don’t think a lot of small businesses realize this, we just think about making our business survive, don’t do anything, then hope nothing happens

  5. Edy April 23, 2020 at 3:07 pm - Reply

    I’m an accountant that has clients visit my home, this is helpful

  6. Megan Ashley May 6, 2020 at 2:52 am - Reply

    With COVID-19 this is really important to understand

  7. Deborah Moser May 7, 2020 at 10:08 pm - Reply

    I’m a self-employed accountant that works from home, thanks for good info

  8. Noel June 29, 2020 at 4:16 pm - Reply

    If you have a business at your home, make sure you know your risk

  9. Julie Weire July 22, 2020 at 8:32 am - Reply

    I wonder how many professionals actually buy professional liability?

  10. Juit Weire July 25, 2020 at 2:15 pm - Reply

    Thank you! I do want to get our biz on our home policy if at all possible.

  11. Chris November 5, 2020 at 5:42 pm - Reply

    I wonder how many small businesses don’t have insurance. It bet it is a lot!

  12. Quinn November 14, 2020 at 9:38 am - Reply

    I’m glad I looked this up

  13. Patty December 27, 2020 at 3:14 am - Reply

    Home biz thrives

  14. Trager February 24, 2021 at 8:11 am - Reply

    Bookmarked your website for easy access! These insurance articles are great

  15. Karen July 27, 2021 at 3:06 pm - Reply

    Good article, thank you

  16. Roza August 17, 2021 at 8:20 am - Reply

    Does this include consultant type of work?

  17. Melanie August 17, 2021 at 8:41 am - Reply

    I have a lot of clients come and visit me at my home, eck

  18. Anetta August 17, 2021 at 9:07 am - Reply

    My home business does not really make much money so I’m not worried about it.

  19. Martha Q August 17, 2021 at 9:34 am - Reply

    I guess I can see the need here for home business insurance

  20. Joanna P August 17, 2021 at 9:56 am - Reply

    I’ve run a business out of my home for 15 years and I’ve never heard of this. I’m not sure I really need it.

  21. Zoe September 27, 2021 at 6:54 am - Reply

    Good – I should definitely pronounce, impressed with your website. I had no trouble navigating through all tabs as well as related information ended up being truly simple to do to access. I recently found what I hoped for before you know it at all.

  22. Zane November 27, 2021 at 11:34 am - Reply

    I have been surfing online greater for a good agency, thank you! It’s pretty value sufficient for me. In my opinion, if all owners and bloggers made just right content as you did they would do well too. Thanks

Leave A Comment

Related Posts