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Blog Articles: Are you covered to work from home?

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There are many reasons why you may opt to work from home, such as flexible working hours, lower overheads, or to reduce the amount of time you commute each week.

But whether you’re a freelancer, run a business from home or simply work from home for your employer now and then, it’s important to check your home insurance fully covers you.

Depending on the profession or trade you’re in, you may find you’re not sufficiently covered under the terms of your existing policy and may need to take out a dedicated business policy.

If you do have to take out extra cover, it’s a good idea to shop around using MoneySuperMarket – we’ve teamed up with Simply Business so you can compare cover from some of the UK’s leading business insurance companies.

Below, we highlight what to look out for to make sure you get the right cover at the right price when working from home…

Check your existing cover

If you’re thinking of working from home, you should check what you are covered for under the terms of your existing home insurance policy.

Some home contents insurance policies (not buildings insurance) provide cover for ‘administration’ duties, while others won’t cover any items that are used for ‘business or professional purposes’.

In addition, some contents insurance policies won’t automatically provide cover for accidental damage to mobile phones, laptops or any portable computer equipment once they are outside the home.

So, if you use your laptop or mobile devices away from your property, it is probably worth adding an ‘all-risks’ extension to cover any loss of or accidental damage to these items. That way, you’ll be covered whether you’re at home or out and about.

If you’re employed and occasionally take work home, or work from home on specified days, it is again worth checking through your policy document to see if there’s anything you won’t be covered for or anything you need to let your insurer know about.

You should also check with your employer to confirm that it carries adequate insurance for items such as mobile phones and laptops that it has issued to you.

If you run your own business and keep stock or product samples at home, you will also need to inform your insurer and make sure these items are covered under the terms of your contents policy. You may find you need to buy a separate business insurance policy on top of your existing contents insurance.

Similarly, if you keep flammable or hazardous materials in your home or garage, you’ll need to check this is covered by your contents policy. Once again, a dedicated business policy may be required.

Keep in mind that you will need buildings cover alongside your contents policy to protect you against damage to your home caused by fire, floods (including burst pipes), falling trees, storms and subsidence.

What additional cover might you need?

If you have employees, colleagues, clients or members of the public at your home in a business capacity, you will need additional liability insurance cover.

Employer’s liability insurance

If you have employees who will be working from your home you will need to take out employer’s liability (EL) insurance. This will cover you should an employee make a claim against you and your business because they have been injured or have fallen ill because of the work they have carried out for you.

An employee can claim against you even if your company has gone into liquidation or receivership and 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 and many insurers will automatically cover you for at least £10million.

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 consider taking it out.

Public liability insurance

In addition to EL insurance, if you have any customers or members of the public who come into your home in a business capacity, or you go to theirs, it’s a good idea to take out public liability (PL) insurance.

Although it’s not compulsory, it can be well worth having as it will cover you against any claims made against you or your business if, for example, a member of the public injures themselves or damages their property and your business is found to be at fault.

Professional indemnity insurance

Depending on the type of work you do and the industry you’re in, it can also be worth having professional indemnity insurance. This covers your business in the event a client claims against you for any business or financial losses they experience because of the work you did for them.

Check your car insurance

If you use your car for business purposes, there’s a chance you may have to alter your car insurance policy to cover you for any miles that you cover outside of the usual ‘social only’ or ‘social and commuting’ use.

If you or any named driver on your policy has to travel on work-related business away from the office, or your home in this instance, you’ll have to make sure your car insurance covers this – and that will mean including business use on your policy. There are varying levels of cover to consider and you may have to pay more.

If driving is an integral part of the job, you will need a commercial traveling policy, and this is usually more expensive due to the high number of miles being covered each year.

Depending on your circumstances, you may be able to put some or all of your additional insurance costs through your business books, which could have cost and tax advantages. Your accountant will be able to advise you on how to proceed.

Written by Mehdi Punjwani

2020-04-16 11:07:29