18 June 2020

Self-employed? Make sure your business equipment is protected!

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If you’re self-employed, you have equipment that could be damaged in a accident or other type of loss. Of course, you do what you can to keep it safe, but risk is often difficult or impossible to predict so you also need to make sure you have good insurance coverage. Read on to find out how you can be sure you have the best coverage for your business!

Keep your insurer informed from the get-go

As a self-employed worker you have two options for protecting your business, depending on your needs and risks. You can purchase a rider to your home insurance or take out a business insurance policy. These are two different products, and it’s not always clear which is better for you.

That’s why talking to your representative is so important. It’s in your best interest to be as transparent as possible. After talking to an expert, you’ll be ready to make the right decision. An insurance specialist will ask questions to learn more about what you do and offer the appropriate product for your business. Insuring a self-employed person is not the same as insuring a big-box store! Let’s take a closer look.

Where you work

First of all, consider where you run your business. If you work from home, you’ll have more options. And if you can work from anywhere, tell your representative about any mobile equipment to be insured. Note that to qualify for a business insurance policy, you must have an official address. In other words, where you regularly conduct your profession is very important. It’s one of the things that will help the representative determine the coverage you need.

However, if you work from home but haven’t set up a dedicated space for your business, it could be difficult to separate your business property from your personal property. Your home insurance company might only accept a claim for business property if you can demonstrate good faith, even if the incident was not work related.

Where you work affects which insurance policy you should choose. If you normally work from home, your insurance agent will determine whether your profession qualifies for a special home insurance rider. If you work in more than one location (at home, at your clients’ premises, at a coffee shop, etc.), you’ll need business insurance tailored to your type of self-employment. Remember, being self-employed doesn’t necessarily mean you work from home.

Sales

Another factor to take into account for your business insurance is sales, which is used to assess your civil liability risk. Your sales figures are key to determining what kind of protection you need for operating losses and cyber attacks, among other things. If you’re interested in a policy that will protect you against lost income, your representative will ask you for information about your business income, i.e., your sales. Again, it’s important to be honest with your insurer to get the right protection.

Your specific line of work

While the factors we’ve already mentioned are important in identifying the risks you face, certain types of businesses have higher risks than others when it comes to harm or injury to third parties or damage to business equipment. Your representative will take this into account in your insurance proposal. For example, a painter has a lower risk than a tattoo artist who uses needles and works with multiple clients every day. Most insurers will decline to cover high-risk professions under a home insurance policy.

Choosing from the available coverage

Like all workers, the self-employed need coverage for job-related losses. After you’ve provided your representative with all the relevant information, they will tell you what types of coverage are available to help you run your business successfully and with peace of mind. Coverages that benefit the self-employed include:

  • Physical property
  • Civil liability
  • Operating losses

Civil liability for businesses

Whichever industry you work in, you never know who could be put at risk because of what you or your employees do. Civil liability covers:

  • Damage to space you rent from a third party
  • Damage associated with your marketing efforts, such as advertising
  • Damage suffered by a third party at your place of business
  • Damage you cause to a third party while you are working or after the work is complete
  • Bodily harm or property damage resulting from the use of something you make or sell

Physical property insurance

You also need insurance to cover property. For the self-employed this means the tools and equipment you use to run your business, so it’s very important. Depending on your circumstances, your best option might be a home insurance policy with a rider, while in other situations business insurance might be the way to go. Your representative can explain the differences.

For damage to equipment, you might need specific coverage for business property such as:

  • Your laptop
  • Filming equipment
  • Equipment being transported to another location

Depending on the coverages you’ve decided on with the help of your representative, in the event of a claim you could be compensated for the exact amount of the loss.

Operating loss insurance

This coverage kicks in when an insured suffers property damage at the place where they run their business. It’s designed to make up for lost income due to a covered loss. To qualify, you must have a business insurance policy. Risks can also be high if you have a home-based business. But if you work all over the place, other types of risk come into play.

If you work from home and a loss has resulted in equipment damage or prevented you from running your business, your bottom line could take a hit. Flood, theft, and fire all cause physical damage but also make it difficult for you to continue working from home. If it’s hard, but not impossible, for you to operate your business, you won’t be able to claim lost income. Compensation covers things like:

  • Renting a new business space
  • Continuing to pay your employees
  • Renting equipment temporarily

If you have business insurance coverage, you’re entitled to other benefits that can be included in your policy. For example, you can be insured against the theft of cash or of property in your custody. Because there are so many potential risks, there are a lot of advantages to taking out a business insurance policy directly.

Compare policies to pick the right one

Should you experience damage to your business property, you’ll need to know the difference between coverage under home insurance riders and under a business insurance policy. By comparing the two, you’ll learn which is better for your situation. Your home insurance policy is always an option, but it comes with restrictions. If the policy doesn’t include a self-employment rider, coverage for business equipment is limited to a certain threshold depending on the value of what you own. It’s important to get advice from your representative.

Naturally, the most robust protection against all business risks is business insurance. For coverage that meets your expectations, talk to your representative about your needs. Paint an honest and clear picture, with plenty of detail. Through this strong partnership, you’ll discover how to protect yourself against the unexpected, at an affordable price.

A business insurance policy can be a lifesaver in the event of a loss, no matter your business location or the cause of the damage. Promutuel Insurance is there to provide innovative and robust coverage tailored to your self-employment status.