Are you self-employed? Wondering whether your home content insurance policy covers for the losses you suffer in your home-based business?
To answer your question: A home content insurance policy will not cover equipment that you use for your business. For instance, if you are a freelance hydrographer, the expensive pieces of equipment that you have stocked in your garage/basement will not be covered under home contents insurance. You need to buy a separate insurance policy that provides cover for the kind of equipment you use in projects you work on.
What is a self-employed insurance policy?
If you have done enough internet research in self-employed policies, by now you must know that there is no such thing as a self-employed insurance policy. What I mean by that is, being self-employed is not like working for someone else. Every freelancer, self-employed contractor, or an artist who works for himself/herself face unique challenges when it comes to running a business.
As a self-employed person, you need an insurance company, that provides a customized package that takes care of your specific needs. A one-size-fits-all solution is never going to work for you. No matter what insurance you purchase, it will always fall short; unless you intervene and cherry-pick the exact type of cover that your home-based business needs.
What individual insurance policy should I add in my custom self-employed insurance policy?
1. Commercial general liability insurance
Have you ever wondered what you will do if someone passing by or visiting your home-office gets injured due to an accident within your office premise? They have total rights to file a lawsuit against you and demand compensation.
No matter how what preventive measures you take, there is always a chance of coming across a clumsy visitor who has a habit of getting in trouble. It’s not your mistake, but still, you are responsible for their actions; because they are in your property.
Commercial general liability insurance protects you against such lawsuits and covers for the hospital expenses of the injured individual. They are less likely to file a complaint if you provide immediate compensation. Even if they do file it, commercial general liability insurance will take care of the fine or penalty.
2. Professional indemnity insurance
Professional indemnity insurance is another vital player that you need to team up with when it comes to self-employed insurance.
No matter how good you are at your craft, you are going to come across clients who will not be satisfied with your work. They will want their money back and they will go to any lengths to get it back. Anyone who has experience with freelancing will know that this is a rare scenario, and you do need to be prepared for it.
Professional indemnity insurance covers for your mistakes made while working for your clients. They cover for things like an unintentional Copyright breach, damage to documents, theft, negligence, etc.
Commercial general liability and professional indemnity insurance can also be added to your current conventional insurance policy. So, if your current insurance company provides these two insurance plans, get them added to the existing insurance plan instead of looking for a new company. Don’t wait until it is too late.