By October 5, 2010 Read More →

Working from home and how it affects house insurance

Home Working and House InsuranceIn the comments on last week’s post about how home working affects your professional image, business development expert David Wike, raised the subject of whether your house insurance covers you for client meetings. Today’s guest post by continues the theme:

More and more people are taking the plunge and setting up their own home based business. There are already over 2 million “home entrepreneurs” in the UK, from accountants and web designers, to hairdressers and party planners.

But while it’s never been as easy or popular to work from home, there are still some practicalities that need remembering. In particular, just because you have home insurance, it doesn’t mean your home based business will necessarily be covered. Working from home can actually void many standard house insurance policies, so it’s essential you get in touch with your provider to ensure you are properly protected.

Here are a few of the factors you should bear in mind:

Buildings and contents insurance – most buildings insurance policies won’t be affected, but you should still contact your provider, just so you’re on the safe side. Contents insurance can be a different matter. Some insurers will automatically cover up to £5,000 worth of office equipment, such as computers and printers, but if you need lots of expensive gadgets and add-ons for your business, it might be worth taking out additional “all risk” coverage, which protects against damage and loss.

Public liability insurance – although not a legal requirement, it’s well worth getting if any clients or members of the public will be visiting your house for business reasons. It’ll protect you from any claims made for unforeseen accidents, for example, if they were to trip and fall down the stairs.

Employers’ liability insurance – if you have any other staff working for you, by law you must take out employers’ liability insurance to cover them for any injury or illness they get as a result of their job. You’re at risk of a fine if you don’t, not to mention the massive legal bills you could face.

Product liability insurance – this is recommended for home businesses that manufacture or supply products for customers. It protects you from any claims for personal injury or damage caused by the product.

Professional indemnity insurance – alternatively, this is suitable for firms that give advice rather than sell goods, such as accountants or consultants. This will protect you against clients claiming for any losses as a result of any bad advice you may have given them.

Car insurance – often an oversight, but home based business owners should double check whether their car insurance covers business use, and if not, you should upgrade your policy. Even something as mundane as a trip to the Post Office could be classified as a business journey.

8 Comments on "Working from home and how it affects house insurance"

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  1. David Wike says:

    Hi Judy,

    I am flattered to be called an expert! I’m pleased that my comments have opened up the debate in this important area and well done for getting an input to clarify the position.

    • judy says:

      Well, David, I don’t know how else to describe you!

      Yes, guest posts are a new feature for the site and I think it’ll be helpful for readers to get different expertise and points of view. And not have to keep reading my rantings all the time!

  2. dawn o\'driscoll says:

    hi,my insurer will not cover me anymore as i am about to work from home as a florist, do you know of any insurers who may cover?

  3. Judy says:

    Hi Dawn, I’m not an expert on home business insurance by any means, but I suggest you start with the companies who have provided guest posts on the site. Click on the home working insurance tag to go through them all. Good luck!

  4. peter dawson says:

    Help. I’m an artist and like most artists work from home want to take part in ‘open studios’ art trails where members of the public can visit my home to see my work. I have business insurance but cannot find a single house / contents insurance company who will permit public to visit my house. All of my artist friends have open studios – they just dont tell their insurance companies. What can I do- and stay legal?

    • Judy says:

      I’m afraid I have no magic answer for you, Peter, as it sounds like you have made all the right enquiries, and I’m sure you’ve also spoken to the organisers of these events to get their advice. I’ve visited open studios many times, and must admit I’ve never thought about the insurance implications.

  5. Brian Bird says:

    I have started a dog walking business I to to peoples homes pick up their dogs, walk them drop them off then go home. Will this effect my home insurance?.

    • It sounds unlikely if you only do paperwork at home, Brian, but you should tell your insurance company, as otherwise they might refuse to pay out if you have a claim.
      Good luck with the business, it sounds like fun!