Insurance For Home Workers

According to the Office for National Statistics, 2.2 million people telecommute in the U.K. However, they are only the forerunners of the white collar migration; 30% of those still in the office say they want to work from home. Many cite the advantages to both employee and employer, such as reduced fuel consumption, and reduced space costs for employers. There really are many great reasons to telecommute.

Home worker insurance is not only an issue for an employee who has been given the option to work from home for part or all of their weekly hours, it is also a consideration for small, cottage industry-type companies and other home start-ups who may require an even more comprehensive insurance policy. We'll deal with these two different circumstances separately.

For The Worker At Home Who Is Employed By A Company

A common question asked by employees who work from home for a company who have offices elsewhere is "will my employer's business insurance cover the equipment I use for my job?" and the short answer is that it is unlikely. Most insurance companies will require that, as a home worker, you take out your own insurance.

Is My Current Contents Insurance Sufficient For My Home Office Needs?

As a home worker you might think that you current home insurance is enough to protect you given your limited additional requirements. After all, you'll be using your personal home office equipment and isn't that covered already? Well, actually, not always. Insurance companies will do what they can to limit the payout when it comes to any claim and if they can prove you were performing business activities when the damage or loss occurred then they might not look too favourably on your claim.

Luckily there are insurance companies out there who provide fairly basic insurance for home-based workers. However, your first port of call should be your current insurer as it might be possible for you to buy additional cover for home working and the extra risks that it brings; this might also be the cheapest option.

Insurance For Start-ups & Professionals Working From Home

If you work from home as a worker in your own small business or as a professional then your needs are different to those of an employee of a larger organisation as above.

A home worker insurance policy will, in many cases, provide sufficient protection for you and your commercial needs but there are still other details that you will need to look at to see if they apply to you.

Is Employers' Liability Insurance Included In A Home Workers Policy?

Some of the information for this section comes straight from the government, in particular the Health and Safety Executive. You can find more information here: http://www.hse.gov.uk/pubns/hse40.pdf

As a small business it might just be you working from home by yourself but if you employ somebody who also works from your home then you need to be aware of employers' liability insurance. Some home worker insurance policies will incorporate some form of employer's liability insurance but you need to be 100% sure if this is the case or not as this form of liability insurance is required by law for all employers. You must have at least £5 million worth of cover so again it is imperative that you check before buying.

Is Public Liability Insurance Included In A Home Workers Policy?

Less common as part of standard home workers insurance is public liability insurance and it will not be applicable to all home-based workers. Public liability cover is for businesses that expect customers, suppliers or any other member of the public to visit them on their premises. The protection it puts in place is in case one of these guests is injured while in your place of work and subsequently seeks to pursue legal action and stake a claim for compensation. Public liability insurance will cover legal expenses along with any payout resulting from a ruling or settlement.

Workers who visit other people in their homes or clients in their offices are also covered by public liability insurance so hairdressers, gardeners, cleaners, painters and decorators for example should be checking whether their home workers insurance has public liability insurance too.

Is Professional Indemnity Insurance Included In A Home Workers Policy?

If you provide a service for people then you should almost certainly buy professional indemnity insurance to cover you should one of your clients claim against you for mistakes or negligence on your part. Indeed it is compulsory in many professions including accountants, insurance brokers, architects, solicitors and financial advisers.

In the event that you work from home in one of these professions or another where you complete service-based work for clients, you may be wondering whether your home business insurance provides PI insurance as part of the package but unfortunately this is rarely the case. Indemnity insurance of this type must be purchased for your business separately.

Things To Look Out For With Home Workers Insurance

• Cover for stock – is stock stored in your home covered? What about goods in transit?
• Machinery and computer breakdown – is this covered as standard or an optional extra?
• Business Interruption – if something happens that prevents you from running your business as normal are you covered for the losses you incur from lost business?
• Income owed (debtors) – if one of your customers goes into bankruptcy while still owing you or your company, will the insurance company cover the income owed to you? How much do they cover?
• Does the policy cover all tradesmen or are these required to buy separate specialist insurance cover?
• Malicious attack or assault – if you or your business is targeted for any reason resulting in the loss or damage of property or money, will your insurer cover you?

Other Occupations That Might Need Home Workers Insurance

Here are just a few of the occupations that should think about taking out insurance for their home-based business:

graphic designers, consultants, virtual assistants, freelance journalists, web developers, bookkeepers, legal advisers, software developers, translators, wedding planners, project managers and home-based customer service professionals.

This list is far from extensive and pretty much anybody who works from home all or some of the time should look into their need for insurance.