Home-Based Workers Need Insurance

03/29/2010

Cost-cutters during the recession may have turned to telecommuting as a source of savings. Others, frustrated with the job market, opened their own business within their homes.

These ventures often require substantial investments in technology and business equipment - much of which may not be covered by home insurance. A recent report by the Insurance Information Institute showed that less than half of those with home-based businesses have the appropriate insurance to protect possible losses.

Most home insurance policies cover up to $2,500 in damaged or stolen business equipment. They also do not cover work compensation or the company's income in case of an interruption.

"No matter how industrious you are, one uninsured event relating specifically to your home-based business can deal a significant financial blow to the company," Mike Barry, vice president of media relations for III, said. "The key to protecting your home-based business is securing the appropriate coverage."

There are three basic kinds of insurance available to home-based business owners, according to the report. Some may choose to raise the policy limits on their homeowners insurance with an endorsement or rider. Or, they may seek more comprehensive coverage through an in-home business policy or business owners policy.

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