A record number of more than one and a half million people in Britain are now working from home, revealed the Mirror newspaper on the 20th of May 2016. Against a background of more and more people finding it difficult to secure full-time employment, working from home offers considerable flexibility in working hours and an opportunity to set up your own business without many of the overheads you might otherwise encounter. Depending on your requirements, you might need a bespoke working from home insurance policy.
Whatever line of business you choose to operate, however, insurance is one of the important essentials.
What risks does it need to cover?
Your existing home insurance is unlikely to cover all of the risks associated with working from home – as we have mentioned here at GSI Insurance in our description of the policies we are able to arrange working from home insurance.
As with any coverage, home office insurance needs to be tailored to meet your particular, individual needs and requirements, so there is no single “package” likely to suit everyone. The following components, however, may be some of the more common risks insured:
- your existing home insurance may or may not provide cover for the structure and fabric of your property if it is being used as a home office (especially if you have visitors associated with your business);
- once again, you might want to check whether your existing home insurance covers those items – furniture, equipment, computers and the like – which you specifically use for your business;
- if it does not, you may need to incorporate this cover into your home office insurance;
Public liability insurance
- your entire home-based business may be run into the ground before it even takes off if you are faced by a claim from one of your calling customers, a supplier or even a member of the public who suffers an injury or has their property damaged in some way connected with the business you are running from home;
- claims are likely to turn on allegations of your failure to exercise your duty of care to ensure that such incidents do not occur;
- the claims may reach quite substantial proportions, so it is usual for home office insurance to provide cover of at least £1 million;
Professional liability insurance
- this element of insurance protects you from claims made by customers who allege they have suffered a financial loss as the direct result of advice you have given or professional services you have offered;
- once again, claims may reach quite substantial proportions and this needs to be taken into account when determining the sum insured;
- in some professions, such as accountancy professional liability insurance is a condition of your registration and membership – the Institute of Chartered Accountants in England and Wales (ICAEW), for example, requires its members to hold a minimum of £1.5 million indemnity;
Employers’ liability insurance
- you might be working from home, but it is still possible that you are employing someone other than an immediate member of your family to help run your business;
- in that event, the law requires that you hold a minimum of £5 million to cover the possibility of their having an accident or contracting an illness because of the work they are doing for you.
It might be clear therefore that when you start to work from home, your existing building and contents insurance alone is unlikely to provide the protection you need, and you’d be much better off with working from home insurance.