Research undertaken by Direct Line, one of the UK’s largest insurers, has found that a massive amount of home based businesses are not protecting their business with appropriate business insurance. If your business was left unable to trade due to un-seen circumstances, without the correct business insurance, your home based businesses could loose money.

Direct Line have found that around 28% of all home based businesses are not insured correctly. Out of the 75% that do have some kind of insurance, only a mere 12% actually have sufficient cover for their business.

The amount of home based businesses that take out public liability insurance isn’t a great deal better than those taking out business insurance. Only 32% of businesses actually have public liability insurance, which means that over 65% of home based businesses are not protected against claims made against their business.

The reason why so many home grown businesses aren’t buying the correct insurance is because they believe it’s covered by their standard home insurance. The majority of people, when setting up a home business, forget about getting appropriate office insurance when the entire business is run from your home, which is fully insured. However, when it comes to make a business claim, the majority of business owners will be shocked when they are turned away by their business insurer. Many business minded people would see setting up a home business as being a cheap and quick solution, however, if they were to setup anything else, as an example, a salon, they would always think of getting appropriate salon insurance, but when it comes to home based businesses, it slips many people’s minds.

Direct Line recommends that if your home business isn’t yet insured, you take out the appropriate insurance as soon as possible. That way you are covered for any problems that may occur during your home business career.

The head of the Business section of Direct Line, Kate Syred, said this about the research results. “With so few businesses being protected from a liability claim, or an unexpected pause in trading, this research highlights the need for business owners to think about specific business insurance. Without it, dreams of being a business owner could quickly become a nightmare.”

Tags: Business, business insurance, home based business, home businesses