Home-Based Business Insurance in Ontario
More and more people are operating businesses from their homes. Having your business in your home can be perfect for many reasons, but it can also change everything. Business owners who operate from their homes require a home-based business insurance policy to be properly protected. This policy is often inexpensive, but it is a wise investment and will protect your business and home while giving you peace of mind. Our experienced brokers at Morison insurance will provide insurance tailored to meet your needs.
Your home policy does not cover damages or accidents resulting from performing business operations out of your home. For this reason, adding a home-based business insurance endorsement to your homeowner insurance policy is essential. Speak with an insurance expert to ensure you have the right insurance policy.
What is Home-Based Business Insurance?
Home-based business insurance protects your home business from damages, losses and liabilities that may occur in your home as a result of the business that you conduct. Some things commonly covered include your office equipment, client liabilities, and business interruption if your home is ruined and renders you incapable of running your business as you otherwise would.
A home-based business insurance policy can be added to your property insurance as an endorsement to protect your business. It's important to note that different insurance companies may not all offer protection for the same type of business. Instead, they will have a list of specific businesses they will cover. If your business does not fit into one of those categories, then you will need a commercial business insurance policy—even if the business is registered to your home. Many homeowners don't realize they need some sort of home-based business protection if their business is registered to their home, regardless of the business they operate. Your business will need a home-based business insurance endorsement or commercial insurance coverage.
For example, if you make handmade products out of your home that you sell online, a small home-based business insurance policy will likely provide adequate coverage. However, you will likely need a commercial policy if you work as a plumber. This is because plumbers tend to make more income than craft-based businesses, so they need more coverage that's not necessarily offered under a home-based business insurance policy.
Who Needs Home-Based Business Insurance?
All business owners operating their businesses out of their homes should strongly consider home-based business insurance. Ontario home business owners can encounter costly problems that require adequate financial support to overcome issues such as stolen equipment, clients can sue, and damages to your home can prevent you from conducting your business. Don't let business risks like these hinder your growth. Get the right coverage you need to be protected by letting the brokers at Morison Insurance start a home-based business insurance quote.
Why Get Home-Based Business Insurance In Ontario?
If your business is registered to your home, you must disclose this to your insurance carrier and broker. Otherwise, you won't have any protection if a third party decides to sue you. The person filing the suit can go after your home—not just your business. Also, if you don’t notify your broker, it’s possible that they could cancel your policy.
When you begin a home-based business insurance quote, the brokers at Morison Insurance will ask questions to determine if you need commercial or personal insurance coverage. Adding this coverage to your personal coverage is inexpensive; a basic package can cost as little as $100 and go up to $600. Commercial coverage for home-based-business insurance generally offers more robust coverage from a commercial perspective and typically starts around $750 and goes up from there.
What Are Some Important Coverages To Consider?
When inquiring about your unique home-based business insurance policy, you should ask your broker what the policy covers and if you need any add-ons to provide complete protection. Different insurance policies offer different levels of coverage. Your Morison Insurance broker will work with you to ensure you purchase the right insurance from a company that offers the best coverage possible. Here are a few types of coverage that could be included in your insurance policy.
Valuable Papers Protection
If you have essential documents as part of your business, you need valuable paper protection as part of your home-based business insurance. For example, suppose you’re an accountant and house important financial information for your clients at home. If you were to lose those documents during a fire, you could find yourself in severe legal or financial trouble. With valuable paper protection, you are covered for the cost of reconstructing or transcribing documents and records that were damaged or lost following a covered loss. If the documents were irreplaceable—say you work in antiques and lost a vital certification of authenticity—the insurance company may cover the value of the lost or destroyed property. However, it's important to note that this will vary per insurance provider.
Extra Expenses Protection
This covers a reduction in income due to a loss. Extra expenses protection is a type of home-based business insurance coverage that pays for a company's non-ordinary expenses after a disruptive incident. For instance, if you are a photographer and your studio is located in your basement, and it was damaged due to a flood, this policy could provide cash to help you stay in business. At the same time, your property is repaired or replaced. This type of coverage applies to when a business is forced to close temporarily and when it has been restored to normal daily operations. It's important to note that the expenses covered under an extra expense insurance policy need to be considered reasonable and necessary. This could include the cost of setting up a temporary studio (in keeping with the photographer example) so that you can maintain usual business activities, should your studio not be accessible while it's being repaired.
Personal Liability
Business owners often confuse personal injury liability insurance with general liability insurance. However, the two are different. General liability covers third-party property damage and bodily injury. Meanwhile, personal injury liability protects you and your family from lawsuits relating to libel or slander. This can include comments made on public websites and social media accounts. This type of home-based business insurance coverage can be beneficial if you provide a service or goods for people inclined to leave reviews. Should a client defame you publicly, you have grounds to sue them to protect your good name and prevent loss of business.
Business Property Protection
Most standard home insurance policies have particular limits applied to any contents of a home business. Unique home-based business insurance coverage can be purchased to ensure the investment you have made into the property of your business, including such items as computers, filing cabinets, and printers will be protected by selecting a limit to suit your unique business needs.
Business Interruption Protection
Suppose you suffer a loss to your home, where your business is operating, and you cannot continue with normal operations. In that case, business interruption insurance will cover the loss of business income or profit lost during restoration to repair or restore your home.
Commercial General Liability Protection
Liability is one of home businesses' most significant and common risks. The personal liability coverage under your personal property policy will not cover liability arising from business operations in your home. A client could fall while walking up the steps to your home, or you could be sued because of problems with a product or service you provide. The liability coverage under your home-based business insurance endorsement will provide you with the added liability protection you need.
Cyber Liability Insurance
Cybercrime can be extremely costly to your business. Protect yourself with cyber liability insurance. This coverage protects you if the confidential client and/or financial information is hacked, stolen or compromised due to other cyber attacks and security breaches, such as phishing. Cyber liability on your home-based business insurance provides coverage for notification costs, legal expenses and risk management fees.
Product Liability Insurance
This home-based business insurance covers property damage or bodily injury due to a product you sell, manufacture or distribute. For instance, if you manufacture soap out of your home and a client sues you claiming the soap gave them a rash, product liability insurance will usually cover the cost of legal fees, settlements and defence costs. Product liability insurance usually covers damages caused by design, manufacturing and marketing defects.
Equipment Breakdown Insurance
If you use any equipment for your business, consider purchasing equipment breakdown coverage for your home-based business insurance. This type of coverage covers repairing or replacing equipment damaged due to an electrical or mechanical breakdown. This includes everything from sewing machines to computers.
Other Coverages
Speak to a licenced Morison Insurance broker to discuss beginning a home-based business insurance quote or any other available coverages.
What Is Not Covered Under This Policy?
Typically, a home-based business insurance policy in Ontario will not include errors and omissions insurance. Also known as professional liability or malpractice insurance, this coverage is critical for professionals. However, depending on your insurance provider, it's usually purchased through an association or as extra coverage. It can also be included in some commercial insurance policies.
Professional liability insurance protects individuals from being sued because their clients lost money due to bad advice, breaking a contract, alleged negligence, misconduct and failure to deliver services as promised.
How Much Does Home-Based Business Insurance Cost?
Many entrepreneurs are surprised at how affordable home-based business insurance coverage is. Usually, you can purchase an addition to your home insurance policy for between $100 and $600. However, you should note that this coverage limit only extends to businesses that earn a certain amount. If you earn more than that amount, you will need commercial business insurance coverage instead, which generally starts at around $750 and goes up from there based on factors such as the type of business, the necessary coverage limits and your unique risk exposures.
What Is the Difference Between General Liability Insurance and Home-Based Business Insurance?
Home-based business insurance usually covers more than just general liability, although general liability coverage can be included in this policy. To run your home business safely, you will likely need more than just general liability coverage. While it protects you from being sued because a third-party was injured on your property or your business operations damaged their property, most entrepreneurs need extra coverage—such as business property protection and personal liability.
Does My Homeowner's Policy Cover Disasters That Occur Due To Business Equipment Failure?
Most homeowner's policies do not cover any property damages to your home resulting from a business-related activity. For instance, if you use metalsmithing tools to make jewelry out of your basement and these tools cause a fire and destroy part of your home, you will most likely not be covered by your homeowner's policy. Instead, check to see if your home-based business insurance policy will protect you from this risk.
Do I Need Errors And Omissions Insurance?
If you offer professional services, you need errors and omissions insurance. Professional liability insurance is vital if your business relies on advising clients, such as accountants, therapists and consultants. Without it, you may wind up in serious legal trouble should a client allege they lost money due to bad advice, failure to deliver services as promised, alleged negligence and more. Don't take business risks. Make sure you have proper coverage by speaking with one of our qualified Morison Insurance brokers.
Do I Need Home-Based Business Insurance Coverage To Work From Home?
No, you do not need home-based business insurance coverage to work from home—unless you are an entrepreneur whose business is registered to your home. If your company has transitioned to working from home, you do not need additional coverage to protect yourself. You should talk to your insurance broker if you have concerns about a laptop or other expensive equipment theft. These high-value items are likely protected under your standard homeowner's insurance policy.
Where Can I Get Home-Based Business Insurance?
Are you interesting in buying home-based business insurance? We can help! At Morison Insurance, our experienced brokers work hard to provide our clients with the best insurance coverage at competitive quotes. As a family-owned and operated business, we extend that sense of being part of our family to all our customers. We want to build a long-term relationship with you, so you can have peace of mind knowing that our team always has your best interests at heart. With highly proficient and friendly brokers, it's no surprise that we are one of Ontario's most trusted insurance brokerages.
Speak with an expert at Morison Insurance, where we start a home-based business insurance quote today. Let's ensure your adequately protected. Get started today by calling 1-800-463-8074 or filling out the form on our website.
