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How To Insure A Home Business

Aug 17, 2007
There are many differences between insuring a home business and a large corporation. You can get the best deal in home business insurance, with a systematic approach. No matter what kind of business you are running, insurance is necessary for every business so that you do not have to regret any unforeseen occurrence.

How to Start
To insure a home business, first of all decide the additional insurance coverage required for a home based business that is not covered otherwise. For example, most of the homeowners' policies cover a risk of only up to $2500. This is a very small amount considering the risk associated with home business properties. Furthermore, you have to insure for lost income and liabilities. Contact the local office of chamber of commerce or any other organization for self-employment and inquire about the available insurance programs. Also, take advice of your present insurance company from whom you have bought the rental or homeowner insurance policy. It can guide you regarding the additions in insuring home office property.

Insurance Coverage For Business Interruption
While insuring a home business, also gather information regarding the business interruption policies. In this type of insurance, the company reimburses you the amount, in case of sudden obstructions in day to day business operations. Different companies offer different options with varying price tags, By putting some extra effort in shopping around, you may end up getting the best possible deal.

There are certain special policies also for particular kinds of businesses. For example, a professional should have professional liability insurance. Similarly, those businesses, which deal in food products or homemade personal care products, may need some special policies. Varying with the kind of business and the insurance company, you have basically three options before you to insure a home business.

A Quick Look at All The Three Options
1. First is a homeowner's policy endorsement. This is simply endorsing your current homeowner's policy. By paying only $25, you can double the risk coverage for business equipment. A liability endorsement is also available for the homeowner's policy. However, insurance companies provide it only for those businesses, which have a limited number of visitors.

2. The second option is an in home business policy. The area of coverage in this policy is much wider than the first one.

3. The third option is business owners' policy. This policy is designed for the businesses that perform business activities from two or locations.

Additional Help
There are firms online that can help you choose the right insurance package for your small business.
About the Author
David Gass is President of Business Credit Services, Inc. His company publishes a free weekly e-newsletter on Small Business Consulting at their web site http://www.smallbusinessconsulting.com.
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