Insurance for the Self-Employed
You’re self-employed and wondering about your business insurance options? Here’s what you need to know!
1. Business Property (included in your home insurance)
If you work from home, know that this coverage is already included in your home insurance and it covers your computer equipment and software, instruments, books, merchandise, tools and clothing. However, the coverage amount stops at $2,000.
So the question you have to ask yourself is: is this enough for my needs?
If you consider this amount to be insufficient, you’ll have to take out working from home insurance.
2. Working From Home Insurance WFH insurance not only covers your business property, it covers your civil liability, business interruption as well as client accounts, valuable papers and professional fees.
“I already have civil liability insurance with my home insurance.” Yes, but it won’t cover your professional civil liability.
In this case, the civil liability coverage applies to damages caused by you during the course of your work as well as those caused by your products.
The coverage for business interruption reimburses lost gains stemming from a loss affecting the insured premises (water damage that is forcing you to relocate) or your professional activities (equipment breakdown).
The coverage for client accounts, valuable papers and records, and professional fees reimburses you when a loss prevents you from conducting business (a situation that prevents you from billing).
By the way, working from home insurance is offered as an endorsement (i.e., coverage added to your home insurance policy) or as a standalone contract. In the case of a standalone contract, some insurers will require that you take out your home insurance with them as well.
3. Business Insurance for the Self-employed
If you work anywhere but home, then you’ll need to take out business insurance for the self-employed.
Compared to working from home insurance, this one offers broader coverage in terms of business property, business interruption and against the 3 Ds (dishonesty, disappearance and destruction) on the insured premises.
Your insurer may also insist on specific requirements like installing an alarm system that is connected to a central monitoring system, security fence and sprinklers.
Your insurer will analyze your situation and recommend the best coverage for your needs.