COMMON HOME INSURANCE EXCLUSIONS

Working From Home

For many Australians, running a business from home is an attractive proposition. The benefits of being your own boss, working in your own comfortable environment, avoiding the daily commute, and enjoying the flexibility to set your own working hours are hard to resist. However, many home business owners overlook a crucial factor when starting their venture: their home insurance policy.

Home insurance policies are designed to protect your home and belongings against risks such as fire, theft, and natural disasters. However, they are not typically designed to cover commercial activities.

If you run a business from home and experience a loss or damage to your property or belongings, your home insurance policy may not provide adequate protection. It is important to understand the common exclusions that apply to home insurance policies for commercial activities. 

Business equipment and inventory: 

Most home insurance policies have limited business equipment and inventory coverage, such as computers, printers, and stock. If you have expensive equipment or inventory for your business, you may need to purchase additional coverage to protect your assets in the event of theft, damage, or loss.

Business liability: 

Home insurance policies typically exclude coverage for liability claims related to business activities. For example, if a client or supplier is injured on your property while conducting business with you, your home insurance policy may not cover the cost of their medical bills or other expenses. You will need to purchase a separate liability policy to provide adequate protection.

Business interruption: 

Home insurance policies do not typically cover loss related to business interruption or lost income. If your home is damaged in a fire or other disaster and you are unable to work from home, your home insurance policy may not cover your lost income during the time it takes to repair the damage. You will need to purchase business interruption insurance to cover this risk.

Cybersecurity and data breaches: 

Most home insurance policies do not cover losses related to cybersecurity and data breaches. If your business stores sensitive customer data or other confidential information, you must purchase a separate cyber insurance policy to protect your business from the financial and reputational damage caused by a breach.

Commercial vehicles: 

Home insurance policies typically exclude coverage for commercial vehicles, such as delivery vans or company cars. If you use a vehicle for business purposes, you will need to purchase commercial auto insurance to protect your assets and liability.

Understanding the common exclusions that apply to home insurance policies for commercial activities can help you identify the gaps in your coverage and purchase additional policies to protect your home-based business. 

RSM Tasmania is a local business broker so they understand your local issues. They have been servicing Tasmania businesses for over 15 years with outstanding success, and a warm welcoming smile.