In-Home Business Insurance and Your Moneymaking “Hobbies”
Written by: Twin City Group
If you’re like a number of other Americans, you may make a little extra money running a “business” out of your home. Chances are you work on this side business every so often, and you may not come close to making a livable profit on your efforts. You may even consider your little gig a hobby more than a company.
The issue with this scenario stems from your homeowner’s insurance policy. While you don’t put too much stock into your home-based businesses, if you were to file an insurance claim, your agent might. There’s a good chance you need in-home business insurance, even if you’re just managing a “hobby” from your house.
The Value of an In-Home Business Policy
Individuals who file a claim relating to their home business often are surprised that their homeowner’s policy may not cover the damages. These people usually don’t realize what they’re doing in their home is considered a business. Insurance statistics say that over 38 million American households run businesses in-home and do not have adequate coverage.
Without an in-home business policy, you could be held 100% liable for damages done and have no ability to claim anything if problems arise. For instance, if you work with Mary Kay and have $5,000 in makeup at your house, and then a pipe breaks and the entire product is destroyed – you might not be covered for the $5,000 due to homeowner’s insurance not covering business activities.
Is Your Hobby a Business By Law?
While many are surprised to find out they’re not covered for small business activities through homeowner’s, this confusion is often due to a lack of education and understanding. Any way you make money from the confines of your home is not considered a hobby or hustle. It’s considered a business, and thus, needs to be insured as such. Profitability is irrelevant.
Homeowner’s Insurance Doesn’t Cut It
Rough estimates found 50-70% of people running a business from their home did not carry in-home business insurance. That’s a large area of vulnerability for a variety of individuals. There’s a great need for this type of coverage, but most people just don’t understand that homeowner’s insurance won’t cut it.
If you’re running any business in your home, you’ll usually find great benefit in purchasing some in-home coverage. The peace of mind usually is worth more than the premium each month.
In-Home Businesses Not Covered By a Standard Home Policy
Not every in-home business is able to be insured under a standard home policy, in fact, most aren’t eligible. Below you’ll find a brief list of some businesses that if run from your home, would not be covered for any liability that these businesses could bring to your door step.
- Disc Jockey
- Watch Repairman
- Computer Repair
- Personal Fitness Trainer
- Cake Maker
- Product-Based Marketing
- Insurance Agent
- Party Planner
- Jewelry Sales
Find Out If You Need In-Home Business Insurance
If you’re making money from your home, it’s best not to leave things up to chance. Contact an insurance professional at Twin City Group. They will dig deep to figure out if your hobby or business requires additional in-home business insurance or not. Don’t leave your assets and family vulnerable – find out if you need to insure your small business today.