Working from home. Selling handmade goods online. Consulting clients over Zoom. Teaching lessons out of your home. If this sounds like you, you’re part of a growing group of home-based business owners across the United States — but many of these entrepreneurs are missing a critical piece of protection: proper business insurance.
Homeowners insurance is designed to protect your house and personal belongings — not your business operations. That’s important because even small, home-based ventures can face risks that your home policy won’t cover. In fact, studies show that nearly 60 % of home-based businesses do not have dedicated insurance for their business activities, often because owners assume their homeowners policy will protect them.
📊 Why Coverage Gaps Happen
According to industry research:
- Approximately 58 % of home-based businesses have no separate business insurance — and many owners simply don’t understand why they need it.
- Roughly 44 % of home-based business owners either don’t have commercial coverage or aren’t sure what their insurance actually covers.
- A standard homeowners policy may cover only a very limited amount (sometimes as little as $2,500) of business property — and often excludes business liability claims altogether.
These gaps can have real consequences — from replacing lost equipment to covering legal defense costs if a customer is injured while visiting your home business.
🧾 What Home-Based Business Insurance Can Cover
The Home‑Based Business Insurance Guide — U.S. Small Business Administration (SBA) explains that there are several options depending on the size and risk of your business, including:
- Home-business endorsements to your homeowners policy
- Commercial General Liability (for third-party injuries or property damage)
- Business property coverage (for equipment, inventory, etc.)
- Business Owners Policies (BOPs) combining multiple protections in one plan
This kind of insurance can help cover things like legal fees, medical costs from a business injury claim, damaged equipment, and even lost business income — all risks that homeowners insurance alone might not protect against.
🧠 Don’t Assume You’re Covered
Just because you work from home doesn’t mean your home policy automatically protects your business activities. A homeowner’s policy is written with residential living risks in mind, not commercial risk. That’s why many business owners mistakenly believe they’re covered when they’re not.
🏠 Who Should Consider This Coverage
Home-based business insurance is worth considering for:
- Craft sellers, Etsy or online shop owners
- Consultants, designers, and coaches
- Service providers with equipment or client visits
- Small contractors storing tools or materials at home
- Freelancers with business property or professional exposure
Even if your business is “just a side hustle,” the financial and legal risk from a claim can be much bigger than most people expect.
Ready to Protect What You’ve Built?
No one starts a home-based business planning to deal with a loss, but being prepared makes all the difference. If you’re unsure whether your current coverage is adequate, we’d be glad to help — customized to your business and your risks.
👉 Internal Link: Learn more about our Business Insurance options here:
🔗 https://www.smartinsuranceagency.com/business-insurance/
👉 Internal Link: Ready for a custom review or quote? Reach out here:
🔗 https://www.smartinsuranceagency.com/contact/