While you enjoy greater flexibility and control of your career, being a home business owner does mean you have to pay more attention to detail. There’s obviously the financial and legal aspect, but also cyber security, personal liability, business interruption and a few other things you might not have thought about. The team at Pacific Prime share five essential home business insurances you’ll need to consider.
#1 Home insurance
It goes without saying that home insurance should be one of the most important coverages if you have a home business. It’s not only the place you stay in but also where your business takes place.
A solid home insurance policy should at least cover the following:
- Your home’s contents
- Burglary and robbery
- Fire insurance
- Employer’s liability
- Electronic appliance breakdown
- Cash, jewellery and precious metals
- Auxiliary building
- Temporary rental
- Home relocation
Read the fine print to ensure you are paying for what you need, especially the coverage limits, exclusions, benefit terms and conditions.
#2 Professional liability
Also known as third-party liability insurance, this is a must-have insurance policy to protect businesses against losses due to the failure of your service. For example, if your client has suffered financial loss due to a mistake in your accounting report, professional liability insurance can reimburse you for your defense costs against such claims. Even if you lose the lawsuit, professional liability cover can ensure that your clients are adequately compensated.
#3 Cyber insurance
Risks of cyber attacks and information breaches are on the rise. On 29 October 2018, the Singapore Government announced the launch of the world’s first commercial cyber risk facility, which commits up to USD1 billion of cyber insurance to protect corporations in Asia against cyber-related losses.
Cyber insurance offers solid protection against a wide array of risks, including fake emails, hacking, phishing and other cyber-related risks. It can shield your business from costs associated with lost, hacked or stolen data that is either held for ransom or becomes part of a lawsuit against you or your business. It also compensates for data recovery, investigation costs and even dispenses emergency funds during a downtime, depending on your policy’s terms and conditions.
#4 Life insurance
Should anything fatal happen to you or you lose your ability to work due to serious injuries, life insurance pays out a predetermined sum of money, which helps the financial security of your family.
#5 Business interruption insurance
As its name suggests, business interruption insurance is a benefit that covers loss of income and direct costs that a business may suffer after an unforeseen accident or natural disaster. This is crucial for the self-employed as they are usually not covered by workmen compensation insurance that employers in Singapore typically possess.
The funding offered will usually cover the profit that your business would have earned, normal operating expenses that the company still needs to pay and other expenses such as the cost of renting a temporary space.
For more details about home insurance, life insurance, third-party liability insurance and other insurance plans for home businesses, contact Pacific Prime Singapore for advice, quotes and a free plan comparison.