Can Your Homeowners Insurance Policy Cover Your Home Office?

You can count on your homeowners insurance policy to cover just about every aspect of your home. But if you work from home, you're probably wondering if your policy also extends to your home office equipment, not to mention anything that might belong to your customers. Many entrepreneurs assume their homeowners policy offers the protection they need against loss, but the reality is a bit different.

Most Policies Don't Cover Home Offices

Contrary to popular belief, the average homeowners insurance policy does not provide coverage for home offices or anything related to your home business. In fact, most homeowners insurance policies explicitly exclude business equipment and business-related items from being covered. If someone steals a computer that's used in your home office, you might not be able to cover its loss using your homeowners policy.

Some policies offer limited coverage for certain home office equipment, including your computer, printer, and fax machine. However, the coverage amounts are likely to be too low to adequately cover most losses. This means you'll end up paying out-of-pocket to cover any losses that exceed the relatively small limits offered through your homeowners insurance policy.

In short, there's a good chance you won't be able to use your existing homeowners insurance policy when it comes to your home-based business. However, that doesn't mean you'll be left without any protection for your home office.

A Commercial or Business Policy Can Bridge the Gap

If you have a home office and plan on running your business from home, you'll be better off with a business insurance policy. These policies are specifically intended to cover many aspects of your home-based business and protect it against a wide range of losses.

A typical business insurance policy does more than just cover your home office equipment. It can also protect business-related property such as signs and merchandise, as well as any customer property that may be in your possession at the time of the loss. Most business insurance policies also include data-compromise coverage, which means your business can recover in the event a hacker targets your customers' or employees' data.

Most business insurance policies also include general liability coverage, which can help protect you against injury or negligence claims filed against your business. Business interruption coverage is another coverage option that can help you maintain your business income if a covered loss interrupts your business operations.

Keep in mind that a business insurance policy may be a bit more expensive than homeowners insurance coverage. However, the cost is well worth the protection and benefits you'll receive. Contact an insurance agency like the Ronald H. Krupa Insurance Agency to learn more.