It’s often said that purchasing a home is the biggest investment that one will make in their lives. Many homeowners (smartly) choose to protect that investment with home insurance. And now that COVID-19 has swept the globe, you may be using your home as an office space, as well.
Did you know that working from home may affect your insurance policy? You may be:
Working from home temporarily due to COVID-19
Running a new business out of your house
Self-employed
Depending on your situation, you may require a different policy. Here are a few variables that could impact your coverage:
You May Not Be Covered for Damages
Before the pandemic, you may not have had expensive computer equipment in your home. As such, your insurance policy might not offer coverage for these additional electronics. Most policies have a limit for the amount that they’ll cover, and the computer and related accessories that you purchased for work may exceed it.
In some circumstances, your employer may have provided you with a work computer to take home. Their commercial insurance policy should cover any damages to the equipment, so you might not need to worry if any damage occurs. However, it’s best to check with your employer to determine if this is the case.
What About Liability?
Before the pandemic, your house was your personal residence, and that was it. Now, it’s also a place of business.
Although many of us are reducing social contact to prevent the spread of the virus, you may need to receive visitors in your home for a business-related reason. Client meetings may require face-to-face interaction. But if any damages are incurred by the guest during their visit (like a slip on an icy doorstep or bite from a dog), you may be held liable to cover them.
When you registered for home insurance, you may never have anticipated that one day, you’d be working from home. It’s important to review what types of claims your policy actually covers.
No one wants to be held liable for a claim that they believed they had coverage for. Ask your insurance provider about liability insurance for these situations.
Have You Considered Home-Based Business Insurance?
Many people’s employment statuses have changed since the start of the pandemic. You may have decided to start your own business rather than work for a company. This is a bit different than working from home temporarily. For this arrangement, you’ll need a home business insurance policy that covers home-based business assets and expenses.
Think about some of the business equipment that you’ll store in your home, which varies depending on your industry. You may have items like:
Power tools
A computer, printer or other office supplies
Inventory such as clothing and apparel
The costs of replacing these items will add up. If they were to be damaged in any way, not only would it cost you to replace them, but it would impede the daily operations of your company. A standard home insurance policy won’t cover expenses that are related to a business. You may need to extend your coverage to include business assets.
Business Interruption Insurance
This policy is relevant to those working out of their home. If your office is damaged in a fire or other natural disaster, you won’t be able to carry out business as usual. With business interruption insurance, you will be covered for replacing damaged equipment or losses in revenue.
When you’re just starting a business, a setback can be devastating. Talk with your independent insurance agent about business interruption insurance.
Pro Tip: Get a Handle on Rising Electricity Costs
If you’ve been working at home for a year, you may have noticed that your energy bill has steadily increased. Instead of spending 40 hours a week out of the house, you now spend that time using your home office.
We have a few energy saving tips for when you’re at home that will bring down electricity costs:
Use a drying rack or clothesline instead of your dryer
Set up power bars and turn off unused electronics
Replace any incandescent bulbs with LEDs
When you lower your energy bills, you can use those savings to pay for more comprehensive homeowners insurance.
The bottom line is that every homeowners insurance policy is different. In all likelihood, you will need to expand your coverage to properly maintain your home office. When you’re working from home, be sure to inform your insurance agent and ask if any additional coverage is required.
Questions about home business insurance coverage? Contact Wallace & Turner at (937) 324-8492 in Springfield, (937) 652-8492 in Urbana, or info@wtins.com.