Business Insurance - the do’s and the don’ts when working from home
According to recent reports, the number of people who have ditched the daily commute and swapped their office desk for a kitchen table in favour of working from home, is four times higher than two years ago.
It can be better for your mental health - and certainly better for parents eager to spend more time around their family and pets. Plus, if you’re looking to live somewhere more remote to access a positive life-work balance, then this could be the solution..
The digital world makes working from home so easy and accessible - and you don’t even need to be in the same country to do it!
It is mainly 45 to 54 year olds who are most likely to work from home, with one in four people saying they would move jobs entirely if they weren’t allowed some form of flexibility to be at home.
But… how many of those people know that not disclosing your home as a place of work could invalidate insurance and prove extremely costly for employees? Or that, if you run your own business, you might find your insurance doesn't cover you and any equipment you need, in case of damage, loss or theft?
Don’t forget that often, you can put additional insurance costs through your business books, which could have tax advantages.
It’s always recommended that you phone and speak to your insurance provider - so don’t just take our word for it! But here are the most frequently asked questions about working from home when it comes to insurance. How many can you tick off the list?
Do I need special insurance cover?
Often (but not always) computers, laptops, scanners, printers, cameras and phones are covered under the contents of your own home insurance. However, if you remove your laptop from the home and drop it or have it stolen and your home insurance may no longer be valid. You’ll need to check that with your provider.
Your home will probably already have buildings cover alongside your contents policy. This should usually protect you for things like fire, floods, burst pipes, tree damage, storms and subsidence.
Will my home and buildings insurance cover me for working from home?
This will depend on the work you do and what you need to do it. Are you looking after stock or do you need to use high-tech tools? In which case they may not be covered. How many people visit you for work purposes? Do you have business supplies, or create a product or food, perform a professional service, keep flammable or hazardous materials in your home or garage? If so, a dedicated business policy may be required.
There are three main classifications of home working:
Clerical business use: accounts, admin or office work.
Business use with visitors: Child minders, dog groomers and music teachers are just some examples that may fall under this category.
Having visitors to your home could have a higher impact on your insurance policy because your home and contents will be regarded as ‘higher risk’.
Other business use: particularly keeping stock (an increased fire, theft or liability risk). If your stock includes dangerous or hazardous materials, you'll need to check with your insurer if this can be covered.
What is Public Liability Insurance?
This covers liability to members of the public, provided they are not there for any business purposes; friends popping over for a chat, your Mum, children etc..
How do I cover people that visit for business?
This would come under a separate Public Liability Insurance or have a separate Employer’s Liability in place to cover any potential accidents. This could also include a cleaner, dog walker or someone providing childcare etc.
What is Employer’s Liability Insurance?
If you have an employee who will be working from your home, you will need to take out Employer’s Liability (EL) Insurance in case they make a claim against you. They can do this even if your company has gone into liquidation or receivership and, even more worryingly, the NHS can also claim against you for ambulance and treatment costs.
By law you need to have EL insurance that covers you for damages of at least £5million. There are, however, occasions when Employer’s Liability Insurance is not compulsory - for instance, if your business is not a limited company, and its only employees are yourself or close family members - but it may still be wise to investigate it in more detail to see if you need it.
Professional Indemnity Insurance
You'll need this if you're offering advice on a professional basis. This will protect you in a situation when you make a mistake and your client suffers a financial loss which could result in compensation.
Vehicle Insurance
This is really important. If you use your car for business purposes, there’s a chance you may have to alter your policy outside of the usual ‘social only’ or ‘social and commuting’.
If yourself, or any named driver on your policy, has to travel on work-related business away from the office/home, you’ll need to make sure your car insurance company knows this and it’s on your policy. If driving IS part of your job, then you need a commercial travellingpolicy.
