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Maine.gov > PFR Home > Insurance Regulation > Consumer Information > All Brochures > Insuring Your Home Business
Insuring Your Home Business
The Maine Bureau of Insurance
Millions of Americans operate part-time and even full-time businesses from their homes. Many don’t know that their homeowners policy offers little or no protection for the business.
The Maine Bureau of Insurance offers these recommendations to help protect your home-based business:
Consult your insurance professional.
The truth is a homeowners policy was never intended to cover a business, and it generally excludes liability coverage for most business-related activities. There are also restrictions on the coverage it provides for property used for business purposes. A home-business owner may face an unpleasant and possibly financially devastating surprise when he or she tries to make a claim for a loss.
Most homeowners policies do not cover structures used for business purposes or rented to others. If you have a separate structure on your property that is used even partially for business, or an apartment over your garage that is rented to a tenant, your homeowners policy is not providing coverage. For a tenant apartment and some other permitted occupancies, coverage can be added to the homeowners policy by an endorsement. For other business-related activities, a separate policy is required.
For a tenant apartment and some other permitted occupancies, the coverage can be added to the homeowners policy by an endorsement. For many other business-related activities, a separate policy is required.
A homeowners policy generally provides a small amount of coverage for business personal property – usually limited to $2500 for on-premises protection and $500 for off-premises. Business personal property typically includes computers, printers, scanners, fax machines, office supplies and furniture, software, and any other items used in your business activity. For example, if you take your laptop with you to visit clients, your camera and equipment to another location for a photography shoot, or your musical instruments for a performance – your coverage is limited to the $500 off-premises limit regardless of the value of the equipment you are carrying.
How to Protect Your Home and Business.
Consider these questions:
-Do customers or clients come to your home?
The answers to these questions can help determine what types of coverage you need to protect yourself from loss. Generally, there are three different ways to cover a home-based business.
Review your limits. Even if you have a separate business policy or endorsement designed to cover your business, some types of property require special consideration for proper coverage. If your business involves jewelry, camera equipment, fine arts or musical instruments, for example, you should make sure the coverage limit is sufficient for the value of your inventory or customers’ items in your care.
Other Considerations: Review your business operations and policy needs carefully with your insurance professional to eliminate possible gaps in your coverage beyond just your home, such as your auto or umbrella coverage. If your auto is used in your business, your personal auto policy may also contain exclusions:
-Are you a real estate agent who transports clients to view homes?
The first example may likely be covered under your regular personal auto policy with an additional charge, but many other situations may require a separate commercial auto policy.
Although the Bureau can give general insurance information, and help when violations of insurance law have occurred, the Bureau cannot:
Visit the Bureau’s Website at:
Last Updated: August 22, 2012
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