In the wake of the COVID-19 pandemic, there are now more people working from home than at any time in recent history. Unfortunately, many of the individuals who have chosen to operate a home-based business have overlooked the need to purchase business insurance simply because they do not have a traditional brick-and-mortar location. If you are among these individuals, you should know that there are several reasons why it is so important for you to purchase commercial business insurance for your home-based business. Continue reading below to learn more about three of these reasons.
#1: A Home Business Is Not Covered By Home Insurance
One of the primary reasons that many home-based business owners choose not to purchase business insurance is because they believe their business equipment and other materials will be covered by their homeowner's insurance since these items are being kept in the home. This is really quite unfortunate because the truth is that nearly all standard homeowners insurance policies will specifically exclude coverage for home businesses. This means that even if the damage to your home is covered by your home insurance policy, any damage to business-related items will not be covered. In order to ensure these items are covered, you will need to purchase a separate commercial business insurance policy.
#2: Small Businesses Can Be Devastated By Even A Single Lawsuit
Like most small businesses, home-based businesses tend to do a lower volume of sales than larger companies in the same industry. As a result, these businesses are less likely to successfully absorb the costs of a lawsuit without being financially devastated. Choosing to purchase business insurance for your home business will allow you to protect the investment you have made in this company by ensuring that you have the coverage necessary to get through any potential lawsuits without impacting the financial stability of your company.
#3: Many Customers Will Choose Not To Work With Companies That Are Not Fully Insured
Business insurance not only protects the business that holds this coverage, but it protects its customers as well. That is precisely why so many consumers choose to only hire companies that can provide a valid certificate of insurance. This is especially true for companies in the service industry. If you have failed to purchase insurance coverage for your business, you could be missing out on potential profits. Choosing to purchase this insurance coverage now will ensure that your company is able to remain competitive when being considered by future customers.
For more information about commercial business insurance, contact a local company.