Many people may wonder why running a small business would have any impact upon their home insurance policy. If all you did, for example, was sell crafts on eBay, why does this impact the cover for your home at all?
It all comes down to a matter of "risk". Insurers calculate that business use at a property increases the chance of something going wrong, with this being far more likely than for someone who is out at work in an office from 9-5 every day.
This means that if you a business from your no matter the size, there are a number of risk factors that automatically increase. We've gone into a little more depth on these below.
Firstly, your home address is likely to be the registered business address, meaning more people have access to that information. This can, therefore, increase the chances of people damaging your property, either through attempted robberies or through vengeance attacks.
Properties that host a home business can also be seen as higher risk by insurers because of the extra stock and equipment that is likely to be kept at such houses. Even if you are just carrying out clerical work from home, at the very least this is going to encompass a computer, phone and printer. In reality, there is likely to be a large number of relatively expensive pieces of equipment at the home compared to if no work was carried out there. This increases the chance of an expensive claim for damage to equipment, as well as making the property significantly more attractive to opportunist thieves.
A home business also brings with it a host of more complex scenarios, including liability risks. If a customer is visiting the premises, whether that is simply to pick up an item or to receive chiropractic treatment, then there is a chance that some injury or ailment could befall them. This could subsequently result in a liability claim against you, which can end up being extremely costly. Although most home insurance policies provide some form of liability cover, this would not usually provide sufficient cover in the event of a business related claim anyway. Businesses are likely to result in far higher numbers of visitors to the property than if it were just friends popping over. This, in turn, means that an incident is far more likely to occur.
These problems are further complicated if you choose to run a Home Hosting business from your property, as this guarantees that a certain number of guests will be passing through your property on a regular basis. Making sure you have taken all the reasonable precautions to protect yourself (such as removing all valuables and providing adequate health and safety provisions) should go some way toward protecting your home and business. For complete peace of a mind, many choose to take out a home hosting policy.