Insurance to cover your business

By | August 19, 2010

I hate to be a party pooper and/or get people all worked up but an issue arose last night in the Business Discussion Group that I thought was important to raise with the whole group.

Insurance.  Some carriers will NOT cover in home businesses and you need to know what your coverage is (or isn't) if you are planning in-home events.  I had to suspend events in my own home for a year because we learned that not only would my carrier not cover any claims at all if they had anything to do with my business, they would cancel our policy if they learned I WAS conducting any business at home.

What you need to do is call your carrier and tell them that you are THINKING ABOUT joining a Direct Sales company and how would that affect your policy.  DO NOT  tell them that you are currently a demonstrator; until you decide what to do with the information you learn, it's not relevant to them.  Being a demonstrator does NOT AFFECT your coverage; only whether or not you conduct business with physical customers in your home will (stamping and phone calls and things like that are not relevant).  Some carriers, like our current one, required a home business rider that actually made our insurance go DOWN by $23 for some strange reason. 

You can also purchase a separate plan through PRO Insurance Managers (on the website under Service Partners under Business Resources).  BEFORE you purchase a plan from them, though, you need to talk to your carrier and make sure it's OK with them.  My previous carrier was still maintaining that, even with that policy in place, they would cancel our policy with them.  It’s important to remember that you need to maintain that you are exploring your options BEFORE engaging in any in-home business activities. 

Also, before you put anything on your car that identifies you as a demonstrator you must talk to your insurance carrier.  Some will void the policy – AFTER AN ACCIDENT – if they discover you have that on your car.  Sadly, insurance companies look for any reason to nullify coverage so you have to really be on your toes.

Again – I hate to be the bearer of anything that causes angst but I believe knowledge is power and you need to learn about what your options are BEFORE you get yourself into a situation where you run the risk of catastrophic financial problems because someone broke an ankle at your house and now YOU have to pay all their bills!

Do your due diligence and get the information.  As much as it may seem alarmist, it's never a bad idea to know exactly where you stand and how to work around potential issues that could cause you serious consequences in the future.

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