More than half of America's businesses are home-based, per the U.S. Small Business Administration. Starting a business in your home doesn't mean your homeowners insurance will adequately protect your operation.
"A typical homeowner’s policy provides about $2,500 of coverage," says Loretta Worters, vice president of communications for the Insurance Information Institute. That usually will cover equipment but it won't offer liability protection or cover you for lost data or income.
The important thing for any business owner to do when starting out is to have the right type and amount of insurance coverage.
In general, virtual paralegals have the following options for business, notary and personal insurance.
- Homeowners policy endorsement: This is added to a homeowner’s policy to increase coverage on business equipment. There also may be the option to buy a homeowner’s liability endorsement for protection in the event someone — say, a delivery person-is injured on your property
- In-home business policy: An in-home business policy provides more comprehensive coverage for business equipment and liability than a homeowner’s policy endorsement. These policies, which may also be called in-home business endorsements, vary significantly depending on the insurer.
- Business owner’s policy: Also, called a BOP, this plan offers the most comprehensive coverage for small- and mid-size businesses. It protects against many of the same things that in-home business policies do but offers even more coverage.
- Independent Contractor Liability Insurance: Professional Indemnity Insurance, sometimes referred to as Independent Contractor Liability Insurance, provides protection for independent contractors against potential liability for claims arising from clients. For a claim to be successful the client would need to prove that the contractor has been negligent.
- FreelancerUnion.org: is an organization that provides personal insurance including but not limited to health, dental, disability, life and retirement for the self-employed.
- The National Association for the Self-Employed (NASE): is a resource for self-employed and micro-businesses. NASE focuses exclusively on the needs of businesses with ten employees or less, or "micro-businesses. NASE offers entrepreneurs a wide range of resources and tools to help them run their business such as:
- Travel services, including rental car fees and hotels
- Notary Public Errors and Omission Insurance: If you are a notary public you should get errors and omission insurance to protect you and your business. In addition to errors and omission insurance most states require a notary to purchase Notary Bond to protect the public, not the Notary, from negligent mistakes or dishonest acts by a Notary. You can purchase errors and omission insurance and Notary Bond from the National Notary Association.