Insuring Your Home Business Equipment

By Compuquotes Team on October 10th, 2008
Homeowners Insurance

The internet has made it easier than ever for people to work from home, either in their own home-based businesses or as an employee working off-premises in a telecommuting position. While this is a good thing for most home business owners, it also opens the typical home business owner to losses they don't expect. If you use a computer, specialized business equipment, tools for your business or even a fax machine, you may be in for an unpleasant surprise if they are lost, stolen or damaged.

The simple fact is that many homeowners expect their homeowners' insurance to cover everything in their homes. That may not be the case. If you run a home business and use items and equipment at home for business purposes, chances are that your coverage for that equipment is severely limited. Most typical homeowner policies limit coverage for business equipment to no more than $2,500 - for everything. If the business property is not in the home when it is damaged, lost or stolen, you may only be able to collect 10 percent of the value. That means that if your $3,000 laptop, which you use for business recordkeeping, is stolen from your car, the most you can collect for it is $250 - unless you've had the foresight to insure it separately or cover it with a rider on your homeowner or car insurance policy.

When you're considering insurance for your home business, it's important to discuss your needs with your insurance agent. There are many types of coverage that you might not consider, but with which your agent will be familiar. In addition, there are pieces of equipment that you might not think of as �business equipment', but that your insurance company most assuredly will. Some of the important items and things you should consider when purchasing insurance for your home business equipment are:

1. You may be able to increase coverage for business equipment with a rider or endorsement on your current homeowners' insurance policy.
Talk to your insurance agent about the possibility of getting a rider on your current policy to cover specific business equipment in your home. For just a few dollars a month, you may be able to increase the coverage for the computer and communications equipment that you use for business purposes, or even for the furnishings in your home business office.

2. Don't forget the �tools of the trade� that you keep at home.
Even those who don't work at home often bring their business tools home with them. This goes beyond carting your laptop back and forth with you from the office. A chef who brings his knives home, a barber who carries his kit back and forth - or just brings it home to cut the kids' hair - could find themselves laying out thousands of dollars to replace those pieces if they're lost or stolen in a burglary. A rider on your standard homeowner policy should be enough to cover business equipment that you occasionally bring home with you.

3. If you work full time from home, consider purchasing in-home business insurance.
When you work exclusively from home, replacing your business equipment may be just the tip of the iceberg. Home business insurance is designed especially for those who work from home. It will cover your equipment and tools, as well as increasing your liability coverage to insure you against injuries to those who are in your home for business purposes and insuring you for interruption of business. It's a worthwhile investment if the loss of your laptop or tools will cost you money because you can't work without them.

4. Don't forget your inventory.
One of the most common home-based business types is sales. Whether you sell cosmetics to friends or have your own home-based party business, one of your most valuable assets is your at-home inventory. Many sales representatives have several thousand dollars worth of inventory on hand for demonstrations and sales. A fire or burst pipe could end up costing you thousands if your insurance doesn't cover it.

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