A business doesn’t always start in the four corners of a commercial space. Some businesses, not to mention multinational giants, first operated at home. Examples are Google, Amazon, and Disney.
There are many entry points to starting a home based business. Many have tried starting a candle business in the house and succeeded. Tech professionals, like app developers for instance, provide services through a private office. And then, those who love retail start a home-based business by registering as sellers on Amazon or Etsy.
Home based business insurance is a specialized protection program for ventures that operate in a condo, apartment, house, garage, etc. Read this guide to know:
The function and limit of each home based business insurance policy
The cost of insurance for home based businesses
Which insurance companies provide the best coverage
Limits Of General Liability Insurance for Home Based Businesses
|General liability per occurrence limit||$300,000-$2 million|
|General liability aggregate limit||$1 million-$2 million|
|Advertising injury coverage limit||$1 million|
|Products and completed operations coverage limit||$2 million|
|Rented premises liability coverage limit||$300,000|
|Medical payments coverage limit||$5,000|
General liability insurance is useful if you make money as a home based appliance repair technician, craftsman, candlemaker, or soap maker. Consider getting $300,000-$2 million worth of home based business liability insurance.
General liability insurance grants protection against claims for bodily injuries or property damage that third parties file. This business insurance for home based business provides help when:
You manufacture candles in your house. An inspector is conducting a check for fire hazards. While moving around, this inspector steps on wax, slips, and sustains a broken hip.
An independent contractor gets electrocuted by a defective wiring and falls from a height while installing a fire alarm and CCTV camera for your cottage food business
An employee of a supplier stumbles from the stairs while unloading equipment and stocks for your business
A client trips over a toolbox in your home workshop and sustains bruises
You use general liability insurance to cover these costs if a claim is filed for bodily injury or property damage:
Medical treatment of the claimant
Refunds for the damaged property of the claimant
Settlements the claimant demands you give
Attorney fees, court filing fees, investigation fees, and other defense costs
General liability insurance doesn’t only cover claims for bodily injuries or property damage. It can also solve these problems:
Claims for copyright infringement, slander, libel, invasion of privacy, and breach of confidentiality
Equipment loss or damage
Loss or damage of customer’s property while in your care, custody, and control
Liability over rented premises
Accidents caused by a vehicle you borrowed or hired
Limits Of Professional Liability Insurance for Home Based Businesses
|Professional liability per occurrence limit||$1 million|
|Professional liability aggregate limit||$2 million|
Get professional liability insurance if you’re working as a consultant, engineer, architect, or freight broker from an office situated at your condo, house, or apartment.
Consider getting at least $1 million professional liability insurance coverage. Professional liability insurance grants a shield if you commit oversights or wrongful acts. Here are some situations where this insurance is useful:
You lost some important documents, and a client’s cargo wasn’t shipped
Your design for a building has costly errors
You excessively charged a client for your services
You failed to finish deliverables on time
You bailed out of a project midway to take care of another one that gives more commission
A client wants to keep the details of a project under wraps. However, you accidentally shared confidential information with a third party.
Professional liability insurance takes care of settlements, defense costs, and court judgments when a client files a claim for negligence, violation of good faith, inaccurate advice, breach of confidentiality, and other covered perils.
Sometimes, professional liability insurance is underwritten comprehensively that it will also cover the income you lost while attending a court proceeding or investigation. The policy might even cover the cost of proceedings for the cancellation of your license. Contributory damages might even be covered too.
Important note: General liability insurance doesn’t cover errors and omissions. This policy isn’t enough if you’re working as a home based filmmaker, software developer, web developer, personal trainer, martial arts instructor, or yoga instructor. You need another type of working from home business insurance.
Product liability insurance is offered as part of general liability insurance for home based businesses. This is useful for covering bodily injuries or property damage caused by manufactured products that have:
The product liability coverage included in general liability insurance offers $2 million-$3 million coverage.
If you’re a home based business in the food industry, then product liability insurance can help. This home based business insurance coverage also covers claims customers file because of foodborne diseases, food poisoning, and contamination.
Get all the best quotes from leading providers in a click of a button!
Limits Of Commercial Property Insurance for Home Based Businesses
|Building coverage limit||$25,000-$500,000|
|Contents coverage limit||$25,000-$500,000|
|Fences, and other outdoor installations coverage limit||$1,500-$2,500|
|Accounts receivable coverage limit||$10,000|
|Money and securities coverage limit||$5,000|
|Key and lock loss or damage coverage limit||$500|
A homeowner’s insurance doesn’t grant coverage if the condo, house, apartment, private room, or garage you use commercially sustains damage or gets destroyed.
Commercial property insurance does what a homeowner’s insurance can’t. It reimburses losses if the residential space you use to store and manufacture products gets damaged or destroyed by:
Commercial property insurance also covers the equipment and tools inside the residential space of your home based business. Examples of items the policy covers are computers, cooking equipment, and food processing equipment.
Important note: See to it that the amount of coverage you get from commercial property insurance is equal to the replacement cost of your home based business’s condo, house, apartment, or garage.
Your home based business needs to get workers' compensation insurance if it employs one or more people, including family members or relatives (if applicable).
All states, aside from Texas, grant no exception. The table below shows situations where this insurance is useful, depending on the home based business you might be running right now:
|Home based candy manufacturing||An employee cuts his finger while slicing a slab of chocolate|
|Cottage food business||An employee gets burned by the stove while cooking condiments|
|Home based soap making business||An employee is fetching scents, vegetable oil, and other supplies delivered downstairs and falls from your apartment’s steps|
|Home based craft and workshop business||Your employee amputated a finger while using a saw |
|Home based wax manufacturing business||Your employee got burned while pouring wax to a container|
Workers' compensation insurance covers these costs when your employee sustains an occupational injury or disease:
Surgeries, therapies, private EMT service fees, first aid treatment, and other expenses for medical treatment
Hospital bills for nursing, medical supplies, food, X-rays, laboratory tests, and others
Rehabilitation and retraining
Funeral expenses and allowance to dependents
Workers' compensation insurance is expensive, and your pocket might find it painful. Save money by getting pay-as-you-go workers' compensation insurance.
This provides a monthly coverage and can be canceled anytime. Instead of annual revenues, premiums are determined through the monthly income of your business. You get this from Cerity and The Hartford.
Limits Of Commercial Auto Insurance for Home Based Businesses
|Auto liability coverage limit||$25,000 per bodily injury|
$50,000 per accident
$15,000 per property damage
|Uninsured motorist coverage limit||$25,000 per bodily injury|
$50,000 per accident
|Underinsured motorist coverage limit||$25,000 per bodily injury|
$50,000 per accident
|Rental reimbursement coverage limit||$15 per day|
Do you use your personal car to transport supplies and equipment or deliver goods and products? Know that your personal auto insurance won’t grant coverage.
Commercial auto insurance provides a comprehensive shield for all exposures that might happen while you’re using a vehicle commercially. You can use this insurance to:
Cover the medical treatment of persons who sustained property damage or bodily injuries from a vehicular accident you caused
Take care of repair and replacement expenses if your vehicle sustained damage because of fire, theft, vandalism, lightning, weather, collision, and other covered perils
Cover your medical treatment and the passengers as well if your car got involved in an accident caused by an uninsured/underinsured driver
Get reimbursement for public transportation and vehicle rental while your car is with the mechanic
Cover the replacement cost of a trailer or any other equipment attached to the car
All states in the USA require a specific amount of commercial auto insurance for bodily injuries and property damage from an accident you cause. For example, if in Georgia, your commercial auto insurance must provide a liability coverage of $25,000/$50,000/$25,000.
Cyber liability insurance is useful if you’re an independent home based software developer, web developer, or app developer. Consider getting $2 million worth of cyber liability insurance.
IT work involves collecting and processing the data of third parties such as credit card information, phone numbers, address, and others. You’re responsible if such information leaks in the inconvenience of affected parties.
Cyber liability insurance will help you cover costs if a claim is filed after a data breach happens due to a cyber attack, cybersecurity error, or employee negligence. You can use this insurance to:
Cover public relations costs to inform clients of the breach
Pay for professional services to contain the breach and recover lost data
Cover lost revenues if you need to stop working to contain the breach
Account for defense costs and court judgments if affected parties decide to sue
Home based bakery insurance is a specialized insurance program for home bakers that manufacture cakes, cookies, and other goodies. Several insurance companies offer this. Examples are Thimble and FLIP Program. Policies you can get are general liability, professional liability, and commercial property insurance.
|Cost per Month||Cost per Year|
|General liability insurance||$25||$300|
|Professional liability insurance||$35||$420|
|Commercial property insurance||$42.83||$513.96|
|Commercial auto insurance||$56||$672|
|Workers compensation insurance||$70||$840|
As a home based business, expect to pay $25 per month or $300 per year for a $1 million general liability insurance. This home based business insurance cost estimate assumes that you have 5 employees and make $500,000-$750,000 per year.
Be smart in deciding who you work with. Here’s a table showing the rates of insurance companies you might want to consider:
|Cost per Month||Cost per Year||Best for|
|NEXT||$13||$156||Best overall; Fastest general liability insurance for home based businesses|
|CoverWallet||$15||$180||Home based business insurance quotes comparison online|
|Tivly||$17||$204||Comparing home based business insurance quotes over the phone|
|Thimble||$20||$240||On-demand home based business insurance available as a temporary insurance policy|
|Hiscox||$22||$264||Liability insurance with worldwide coverage for home based businesses|
|Progressive||$30||$360||Small home based businesses|
|The Hartford||$37||$444||Growing home based businesses|
Selecting the best home based business insurance policy is sometimes hard. However, by clicking the 'Get Quotes' button below and completing the form, you will be able to easily compare countless home based business insurance quotes and coverage options online from the best home based business insurance companies in America!
Get all the best quotes from leading providers in a click of a button!
Here are the best companies you can work with for your working from home business insurance. That said, read the reviews to know each company's pros, cons, and rate for a $1 million general liability coverage.
Get an online proof of insurance and send as a text message, email, or social media post
Fastest general liability insurance for home based businesses
Great customer service and reputation
Issues an online proof of insurance instantly
Outstanding value for money
Bundle two or more insurance policies and get a 10% discount
Couldn’t find any
NEXT offers general liability, workers' compensation, commercial property, and professional liability insurance for home based businesses. There’s also commercial auto insurance that’s underwritten by Progressive.
NEXT offers a 10% discount if you bundle two or more insurance policies. You can name an unlimited number of additional insureds on your policies for free. Last but not least, NEXT issues an online certificate of insurance you can send as an email, photo, or social media post.
Best for: Best overall; Fastest general liability insurance for home based businesses
Average cost: $13 per month
Our rating: 10/10
Cancel a policy anytime
Compare quotes and find the best pricing
Manage your insurance online
Not an insurance company but an insurance broker
CoverWallet is an online insurance broker with an online quotes comparison platform you can use to find policies that fit the needs of home based businesses. This insurance company covers all types of home based businesses except those that provide specialty services or goods to customers. Business insurance policies you can get from CoverWallet are:
Commercial property insurance
General liability insurance
Professional liability insurance
Business owner’s policy- a combination of general liability and commercial property insurance CoverWallet added with workers comp insurance
Product liability insurance
Commercial auto insurance
Best for: Home based business insurance quotes comparison online
Average cost: $15 per month
Our rating: 10/10
Responsive customer service
Call and compare home based business insurance quotes over the phone
A partner of many reputable insurance companies
You need to call to get a quote
Tivly (formerly CommercialInsurance.NET) doesn’t explicitly have any specialized insurance programs for home businesses. However, get in touch with this company because it will take you to partners that can provide coverage.
Call Tivly now to compare home based business insurance quotes over the phone and get covered.
Best for: Comparing home based business insurance quotes over the phone
Average cost: $17 per month
Our rating: 10/10
On-demand and short-term home based business insurance
Covers home based event vendors, craft businesses, and freelance/professional service businesses
Issues a quote quickly
Doesn’t offer a BOP for home based businesses
Thimble’s home based business insurance is available for event vendors, craft businesses, and freelance and professional service businesses. General liability insurance is the only inclusion. However, this is okay because Thimble insures you in an instant. You can even choose to only get covered for only hours, days, weeks, or months.
Best for: On-demand home based business insurance available as a temporary insurance policy
Average cost: $20 per month
Our rating: 9/10
Easy to work with online for both purchase and policy management
Provides great value for your money
Offers great general liability and professional liability insurance coverages for home based businesses
Low rating on Better Business Bureau
Hiscox specializes in niche insurance in both the personal and commercial spaces. The company is an underwriter for Lloyd’s of London, and it was originally founded in 1901 with the purpose of underwriting marine insurance.
Hiscox offers a range of different coverage options for home based businesses, including general liability coverage, professional liability coverage, and business owner’s policies. One of the best things about Hiscox is that they have a quality online presence that makes it easy to purchase and manage your policy.
Best for: Liability insurance with worldwide coverage for home based businesses
Average cost: $22 per month
Our rating: 8/10
Quick quotes through their website
Not all policies are handled directly
While Progressive’s main industry may be auto insurance, the company also specializes in covering businesses and property. Progressive is one of the 100 biggest companies in the United States based on revenue, and it has been in business for nearly 85 years, having been founded in 1937.
Progressive offers a range of different kinds of coverage under their working from home business insurance policies. These include but are not limited to general liability, professional liability, workers’ compensation, and even commercial auto insurance.
Best for: Small home based businesses
Average cost: $30 per month
Our rating: 7/10
Endorsements allow you to customize your policy
Policies can also include employment practices liability insurance
The Hartford was founded in 1810. As the name would suggest, the company started off in Hartford, Connecticut. It has grown into one of the largest property insurance companies in the United States, insuring businesses, personal autos, homes, and commercial vehicles.
The Hartford’s running a business from home insurance policy is scalable. The company offers several different policies, including general liability coverage, BOPs, commercial property, commercial auto, and workers compensation insurance.
Best for: Growing home based businesses
Average cost: $37 per month
Our rating: 7/10
This place is an absolute joke of a company and should be ashamed of the way they conduct business. I was hurt on the job at the end of July and it took them just shy of 7 weeks to issue out a paycheck to me. Yes the amount was back dated but still. Not many have the luxury of not receiving a paycheck for almost 2 months. To top it all off, the original adjuster marked me down for the wrong state which caused a problem from the get go, I've had 3 different adjusters now since each one can't seem to figure out the simplicity of my claim. All my paperwork which includes, my job, house, and drs visits all are from the same state and city but yet some how I have been filed under a completely different state 1500 miles away. They do not answer your phone calls or emails no matter how many you leave. I've had to escalate my frustrations to the supervisors of each of these individuals in order to even get some kind of response. I've had more communication and information given to me about my claim from the customer service representatives then the actual adjusters.......... please tell me how that works?! A serious overhaul needs to happen here in order to serve your clients the way they deserve to be taken care of. 10/10 do not recommend this company to a single soul on earth
I have never had the displeasure of working with a more incompetent and disrespectful person in my life. I’m an injured worker and the adjuster that was assigned to my case was named Carrie Furgeson. In the past 6 weeks that I’ve been injured and out of work I have only been able to get ahold of her twice, not for lack of trying. I have left countless voicemails, countless emails, and she ignores them all. When I am finally able to get ahold of her I’m greeted with terrible customer service. She is rude, she talks over me and I’m hardly able to get a word in edgewise. She spelled my name wrong on my documents even after I spelled it for her properly countless times, this caused a whole new issue with my bank. I have bill collectors from the hospital calling me demanding payment and Carrie Furgeson won’t do a single thing to help, or to get them paid. All of my documentation is in Colorado, my job is in Colorado, my address is in Colorado, all my Dr offices and appointments have been in Colorado and Carrie still managed to hold my claim because she wasn’t sure what state she needed to file it under. It’s been 6 weeks since my Injury and my company still hasn’t received the wage paperwork to fill out so they can get me my correct wages. When she’s not ignoring me she’s answering my questions with “I don’t know” well I don’t know how she got this job, because apparently she doesn’t know anything about it. She is a disgusting morose individual inside and out and I genuinely wish her the worst in all of her future endeavors. I highly recommend you don’t use this company. Please if you are a business owner and your looking into this company please don’t use them. I’m sure they have the cheapest payment and that’s why companies use them in the first place, but you will be doing your employees a grave disservice by forcing them to venture into this absolute dumpster fire of a company. I would rate 0/5 if possible but 1 was the lowest I was allowed.
Their general liability insurance purchase process is simply the best online experience I've ever had in my life!
As long as they cover your line of business, you're literally covered! best rates, best coverage, best online experience, best professionals, can't be happier that I chose them!
It really can't get any better than this... wow