How Protected Are You Really? 7 Reasons to Protect Your Home Business

by Kat O'Brien

July 27, 2016


revisions-2 (4)For many people, owning a successful business is a dream come true. However, this type of business ownership does carry some risk. Below are a few reasons why you should absolutely consider home based insurance for your business.

Reason #1: Your homeowners will likely not cover everything you need.

Most homeowners insurance only covers $2,500 of property damage. Any damages that exceed this amount must either be self-insured or covered by another policy. The Independent Insurance Agents & Brokers of America found that almost 40% of home business owners never purchased a policy for their business because they thought they were protected under other coverage.

Reason #2: Your homeowners policy could be canceled

If you have not previously disclosed your business to your homeowners insurance company, your policy could be refused or canceled.

Reason #3: A Sole Proprietor Carries All the Liability

Running your business as an individual puts you at the greatest risk for a lawsuit. If the customer feels dissatisfied with your service or product, or if they’re injured in any way, then they can sue for damages. As a sole proprietor, you’ll be the one bearing all financial liability. Unlike a limited liability company, where the owner and business are two separate entities, the sole proprietor and business are considered the same entity by law.

In the unfortunate event that the court awards a huge sum of money as compensation to the plaintiff (your customer), then your home, personal assets, and/or business can be liquidated to pay the amount owed. Home based business insurance will help you to avoid extreme loss in the event of liability.

Reason #4: Protection from Fires and Similar Occurrences

Should a fire or similar disaster occur, it can set you back months – not to mention, thousands of dollars. Without business insurance, you’ll need to front the cost of rebuilding, restocking, and renovating your business. Unfortunately, in many cases, it’s easier to just shut down the business and walk away. Coverage through business insurance makes it possible to rebuild your business in the event that it is affected by a fire or natural disaster.

Reason #5: Trip and Fall Coverage can be essential in protecting your business.

If a client or delivery person trips and falls in your home during business, you could potentially be facing a lawsuit.

Reason #6: Protection Against Defective/Dangerous Products

Depending on what type of business you’re in, there’s a chance you can be held liable for products that you make and sell that cause property damage or bodily injury. For example, if you make and sell glassware and one of your products has a sharp edge that causes injury to the buyer, you may be responsible for compensating that individual. However, with a home business insurance policy in effect, when a claim comes in, you’ll have somewhere to turn. Legal bills can stack up to hundreds of thousands of dollars; isn’t a small insurance premium worth paying for peace of mind?

Reason # 7: The cost of insuring your home business is small considering the potential costs if you don’t have insurance.

A simple home business insurance policy could do a world of good when it comes to protecting you from liability, lawsuits and accidents. Don’t consider insurance for your business as an optional resource; think of it as a necessary safeguard against unplanned hazards and risks. For a small premium, your entity can tap into a resource so you can plan what you will do when you recover, not wonder whether or not you will ever recover. Smart business owners know that constantly worrying about financial ruin is not conducive to growth – after all, you have a business to run! If you’re interested in reading more about how to market and grow your business, we have blogs that cover anything from tips on how to be successful to marketing yourself on Facebook.

Remember, when you open for business, it’s of utmost importance that an insurance company you can trust covers your inventory and assets. See if your home based business is eligible through Lindbergh and seek protection today.

To share the infographic on your site, use the following link.


  1. What Sort of Liability Insurance Does One Need for a Sole Proprietorship?
  2. Do You Need Insurance for Your Business?
  3. What the Rise in Lawsuits Means to Your Small Business
  4. Frivolous Lawsuits
  5. Home Based Business Insurance

DISCLAIMER: This post provides general information related to sole proprietorships. Lindbergh is not a law firm. This information is not intended as a substitute for, and should not be relied upon as, legal advice. It is provided for general educational and informational purposes only. Although Lindbergh strives to ensure that its content is accurate, it makes no guarantees. All legal inquiries should be directed to intellectual property counsel in your State or jurisdiction. Lindbergh is not responsible for any errors or omissions in the content of this post or damages arising from the use of this information under any circumstances.




Get A Free Quote

Get the protection you need at a cost you can afford.

What Our Customers Say

Letitia Hauser was so helpful. She answered all of my questions and never made me feel rushed. She made me feel like my small business is important. Oh definitely. As a matter of fact I’m hosting a local small business gathering in July and I will be mentioning you. Also telling how supportive Letitia was, … Continue reading Shonna Hilliard

Shonna Hilliard

Questions? Contact us!