Will home insurance cover a home business?

pennypincher2013

I'm still in the planning and ideas stage of a small business, working from home.
I have no idea if my home insurance will cover the small business (making and selling crafts). Technically it's not MY home insurance, it's under my mother's name (we live together) so would that affect whether my business would be covered?

And does any home insurance cover home businesses?

DomRavioli

No.

You need public liability insurance. That is completely separate and covers damages done if your product malfunctions or injures someone.

You need your own insurance in your own name to cover your own business.

Savvy_Sue

Another no, because it won't cover any stock / materials you keep at home for your business.

Also does your mum own or rent the home you share? If she owns, then the mortgage company may need to be told you're running a business from home, and if she rents, then the landlord needs to know.

If it's a private landlord, and they have a mortgage, it may be a condition of their mortgage that no business is run from the let property.

If it's a social landlord, there's almost certainly a clause in the tenancy agreement saying your mum (assuming the tenancy is in her name alone) won't run a business from home. Actually permission to run a business shouldn't be unreasonably refused, so as long as you're not planning to run classes from the house or have a multitude of business visitors / deliveries which could cause 'nuisance' to your neighbours.

If you DO expect to have visitors connected with the business coming to your home, then expect insurance to become more problematic: I've just agreed with DH that he won't have any more business meetings at home because it seriously restricts who will insure us, and ups the cost.

How are you planning to sell your work?

Sorry to be a bit negative at this stage ...

rs65

Home insurance can cover business if it's set up correctly.

Google home business insurance - plenty of options.

DomRavioli

rs65 wrote: »

Home insurance can cover business if it's set up correctly.

Google home business insurance - plenty of options.

It won't cover stock or public liability - and it isn't even the OP's home so unlikely to be able to take out home insurance cover.

rs65

DomRavioli wrote: »

It won't cover stock or public liability - and it isn't even the OP's home so unlikely to be able to take out home insurance cover.

It will if its set up correctly. Direct Line for example do home business including £2m PL/products and £75k business contents and stock.

The OP and mother can be the Insured.

antrobus

pennypincher2013 wrote: »

...And does any home insurance cover home businesses?

Some do, some don't.

Google 'craft insurance' - there are plenty of people offering insurance to people running home based craft type busineses.

DomRavioli wrote: »

...You need public liability insurance. That is completely separate and covers damages done if your product malfunctions or injures someone...

You apparently need PL if you intend selling your product at craft fairs, because the organisers insist on it. Otherwise doesn't it depend on the product? After all, what's the risk of an embroidered tablecloth malfunctioning or injuring someone?

WhyNot?

pennypincher2013 wrote: »

I'm still in the planning and ideas stage of a small business, working from home.
I have no idea if my home insurance will cover the small business (making and selling crafts). Technically it's not MY home insurance, it's under my mother's name (we live together) so would that affect whether my business would be covered?

And does any home insurance cover home businesses?

I would advise firstly to ask your mother to contact her insurance company and ask.

For other alternative insurers, I suggest you either google, or better still, consult an insurance broker who specialises in this type of cover.
You'll need to ask your mother if she is willing change insurers too.

Gleeful

rs65 wrote: »

Home insurance can cover business if it's set up correctly.

Google home business insurance - plenty of options.

That's something different than home insurance

Home insurance - insures the home and contents
Home business insurance - insures a business that is run from a home

I have home business insurance and home insurance, they are two totally separate things

scoly

Home insurance covers your home i.e. buildings (& contents if desired). It usually also includes public liability insurance e.g. a slate falls off your roof and injures someone walking past, or a person who falls over a loose paving stone on your driveway and injures themself, etc.

With some insurers you can add business use to this cover. Not all insurers will do this, and many that do restrict it to clerical/home office use.
This would mean no visitors or employees (so no additional public liability risk), no stock (so no added contents risk, but would cover a small amount of additional office equipment including computers, printers, etc.

However, some insurers will add more business use to your home insurance, so it will cover stock, vistors, employees, tools, etc.

e.g. https://www.towergateinsurance.co.uk/home-and-property-insurance/home-business-insurance-guide

That means if you have a business supplier or customer come to see you, and when you are showing them around what you do and what you need, they accidentally injure themself on that hot soldering iron, or sharp saw in your build area, then you will be insured should they claim.

But it only covers the property (and contents) insured.

See also:
http://www.thisismoney.co.uk/money/bills/article-2408036/Which-insurance-best-working-home.html

Specifically, if you are selling elsewhere at say craft fairs, then you will typically need more insurance there (unless the fair offers to insure you). Public liability insurance there would cover, for example, if your display table collapses and insures someone.

There may also be other insurance you need as a business:

Product liability insurance - this covers faulty manufacture or design of your product. If someone uses it as per the instructions, and it fails causing them loss or injury, this will protect you.

Employers liability insurance - required if you employ anyone in your business.

Vehicle insurance - required if you use any vehicle to transport the goods (or you if you provide a service), perhaps to the end customer or even to the craft market. I very much doubt you will find any home insurance that covers business use of a vehicle, but like home insurance, you can usually extend domestic vehicle insurance to cover business use (and if you are transporting stock, should ideally cover that stock in transit particularly against theft etc)

(Nothing in the above should be taken as covering you for being wilfully negligent, wreckless, etc)

There may also be other perils you wish to insure yourself against, but certianly your home insurance can be extended to cover similar risks that apply to the business at that address.

pennypincher2013

So I'm looking for craft insurance? TBH, I've never heard of it before. I will now look into that... I hope to sell online and at craft fairs.

I might just have a completely separate insurer for my business to the home insurance.

Thank you for pointing me in the right direction. I can now research the best option.