Insurance tips if you work from home
Conventional Home insurance doesn’t always offer adequate cover for home workers and freelancers so you might need to extend to include the cover needed for your business.
As we become increasingly interconnected, more and more people are being drawn away from a typical nine-to-five office job and instead choosing to opt for a more adaptable way to work.
Many people find this in a home business which offers flexible working hours, lower (or no) commuter costs and the freedom to express themselves creatively. Setting up a small business from your home can be daunting, so in this article Intasure break down the importance of insurance and the cover you may need if you run a business from home.
The basics – Buildings & Contents insurance
You may be surprised to learn that your existing contents policy might cover some aspects of your business. Some insurers automatically cover up to £5,000 of home office equipment while others decline cover for business related items, so it is important that you check.
Home worker’s insurance can typically cover the following:
- Office contents
- Business equipment
- Public and Employers’ liability
- Business interruption
- Goods-in-transit cover
- Cover for business money kept on the premises, in transit or in a safe
- Personal contents
Even if your policy does cover some items, it may not cover specialist ones such as expensive audio-visual equipment or a photocopier. If you keep stock or product samples at home then they may also not be covered, and you should consider purchasing specialist business insurance on top of your contents cover.
If your contents insurance does not cover accidental damage to mobile phones or computers once they are outside the home then you may choose to add all-risks cover to ensure they can be protected when you’re on the move.
You also need to check whether your home building cover is valid if you work or run a business from home.
Other insurance for home-based business
Employers’ Liability insurance
If you have employees, then you are legally required to have at least £5 million of cover. If you do not have cover you risk a fine of £2,500 for every day that you are not insured.
Employers’ Liability insurance helps protect you should an employee become injured whilst working for you. Claims do not just apply to physical injury, but also to psychological damage. Claims can be wide-ranging, and without cover in place you may be required to fund legal representation as well as a potentially significant financial pay out if the claim is successful.
Public Liability insurance
This provides cover in the event that a third party is injured or their property is damaged as a result of your businesses’ negligence and a claim is brought against you.
If you come into contact with the public then you should consider having this insurance in place, as anything from a slip on your premises through to damage to a visitor’s laptop could result in a claim. While these may sound like every day events, there are more serious events such as someone falling down a badly maintained flight of stairs and suffering a head injury that can lead to a high value compensation claim which you may be liable for.
Professional Indemnity insurance
If a claim is made against your business due to a financial loss suffered by a third party who alleges you have been negligent or given incorrect advice then Professional Indemnity is designed to respond and cover the cost of the claim and any damages made against you.
Ranging from loss of documents through to a libel suit, these claims can be costly and this insurance could give you the support you need to defend your business.
Product Liability insurance
There’s another type of commercial cover designed to protect against claims or injury or damage resulting from a product sold by your business. This cover is designed to help protect your business by covering legal or court costs should an insurable claim be brought against you.
Is insurance tax deductible?
A lot of legal financial costs can be included in your tax return such as insurance premiums. You can claim for a number of commercial insurance policies including insurance for home workers. This could save you some or all of your business costs – if you’re unsure how this works, we suggest getting in touch with an accountant.
You can find out more information in our guide about allowable expenses and insurance that is tax deductible.
Of course, you don’t have to buy all these policies individually; instead you can opt to purchase a specialist working from home insurance package.
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*The opinions and views expressed in the above articles are those of the author only and are for guidance purposes only. The authors disclaim any liability for reliance upon those opinions and would encourage readers to rely upon more than one source before making a decision based on the information.
Ref: FP800 – 2020