Have you become an entrepreneur over the last year, running a home-based business? Or do you sell home products like make-up or plastic storage containers for extra income? If so, are you aware that your standard homeowners insurance policy may leave you with coverage gaps?
As Diane W. Richardson, CPCU, points out in the Home-Based Business Coverage Guide ((c)2015, National Underwriter Co.), there are both property and liability business exposures that most standard policies don't address as well as low limits on coverage.
For example, most homeowners policies limit the amount of coverage available for property on the insured premises used primarily for business purposes. According to Richardson, the unendorsed Insurance Services Office (ISO) homeowners 2011 program provides only $2,500 for business property on the premises and $500 for business property away from the residence premises. The American Association of Insurance Services (AAIS) 2008 program limits are $2,500 and $250, respectively. When you add up the cost of your computer, all-in-one printer, fax and scanner, tablet, modem and router, telephone system, desk, filing cabinet, office supplies and software, you could easily exceed $2,500. And your smartphone by itself could cost more than $500 to replace.
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Rosalie Donlon
Rosalie Donlon is the editor in chief of ALM's insurance and tax publications, including NU Property & Casualty magazine and NU PropertyCasualty360.com. You can contact her at [email protected].
