Self-Employment Insurance
- What is self-employment insurance? Answer
- How do I buy self-employment insurance? Answer
- Who sells this type of insurance? Answer
- How much can self-employment insurance cost? Answer
- I qualify for a discount because my home is equipped with an alarm system. Does the discount also apply to my self-employment insurance? Answer
- If I have a $500 deductible on my home insurance policy, will I automatically have the same deductible on my self-employment policy? Answer
- My home insurance is under my spouse's name. Can I add a self-employment rider in my name? Answer
- I don't have home & property insurance. Can I still purchase self-employment insurance? Answer
- I have basic home insurance. Can I add a self-employment rider? Answer
- If I'm starting a business in January and my home insurance doesn't come up for renewal until July, do I have to wait until July to get my self-employment insurance? Answer
- If my home & property insurance has a replacement cost rider, does it apply to my business property, too? Answer
- I have $5,000 in business assets. My home insurance policy covers me for $1,000 in business assets, so does that mean I can take out self-employment insurance for just $4,000? Answer
- I lease a photocopier for work. Is it covered by my self-employment policy? Answer
- I have a self-employment insurance policy that excludes companies with multiple employees. Am I covered if I have an employee who comes to help me at home from time to time? Answer
- Self-employment insurance covers computer data recovery. What exactly does this mean? Answer
- I run a catering service out of my apartment. If I caused a fire while cooking, would I be covered? Answer
- I had a fire at home and can't work in the basement anymore. A colleague has offered to help and let me use an office with telephone and secretarial services, but I would have to pay for them. Would these expenses be reimbursed? Answer
- Does self-employment insurance cover floods? Answer
- Because of a power outage, I wasn't able to work for three days. Does my self-employment insurance cover my loss in revenues? Answer
- I work at home, but rarely have to go out to meet clients. Do I have to tell my insurer? Answer
- Part of my work includes delivering very expensive tools and equipment to my customers. Does my self-employment insurance cover this? Answer
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Frequently Asked Questions: Self-Employment Insurance
Q - What is self-employment insurance?
A - It's insurance that protects you against the various types of losses you can suffer as a self-employed worker. It covers your business property and business liability, and comes with optional riders.
Since many insurance companies offer self-employment policies, there are obviously differences from one product to the next.
Q - How do I buy self-employment insurance?
A - It's most often offered as a rider on a home & property policy. Some companies also offer it separately.
Q - Who sells this type of insurance?
A - Like other damage insurance products, self-employment insurance is sold by many insurance companies, either through a broker or directly to you.
Q - How much can self-employment insurance cost?
A - The premium depends on the nature of your work and business activities, the value of your property, and the coverage you choose. Insurance is a highly competitive market and premiums can vary considerably, so it's important to shop around.
Q - I qualify for a discount because my home is equipped with an alarm system. Does the discount also apply to my self-employment insurance?
A - Most likely. This is a major marketing tool for insurers, so discuss it with your broker or insurer to find out how much your discount is.
Q - If I have a $500 deductible on my home insurance policy, will I automatically have the same deductible on my self-employment policy?
A - Not necessarily. It's up to you. However, you should be aware that if a loss involves both your personal and business property, the higher of the two deductibles applies.
Q - My home insurance is under my spouse's name. Can I add a self-employment rider in my name?
A - You can if you're married or have been living together for more than three years, because you're considered insured even if the policy is in your spouse's name.
If you've been in a common-law relationship for less than three years, you'll have to have your name added to the home & property insurance policy to insure your personal property. Once this change has been made, you can then add your self-employment rider.
Q - I don't have home & property insurance. Can I still purchase self-employment insurance?
A - Since most self-employment insurance products are add-ons to home & property policies, you should look for a home & property and self-employment policy together. Then you'll be covered for both your personal and business property.
However, some insurers offer a separate policy for self-employment. If you want a separate policy, be sure to clearly state this to the representatives you talk to.
Q - I have basic home insurance. Can I add a self-employment rider?
A - Most self-employment policies are add-ons to "all perils" policies, so you'll probably have to upgrade to all-peril insurance in order to get a self-employment rider. You should discuss this with your broker or insurer since the conditions vary from one insurer to the next.
Q - If I'm starting a business in January and my home insurance doesn't come up for renewal until July, do I have to wait until July to get my self-employment insurance?
A - No, not at all. You can purchase self-employment insurance at any time. However, if you decide to change insurer during your policy term, you may have to pay a penalty. That's why it may be best to get your self-employment rider at renewal time.
Q - If my home & property insurance has a replacement cost rider, does it apply to my business property, too?
A - Generally, yes, your replacement cost rider will also apply to your business property. It's important to note, however, that replacement cost does not apply to some property categories, such as manufactured goods and merchandise.
Q - I have $5,000 in business assets. My home insurance policy already covers me for $1,000 in business assets, so does that mean I can take out self-employment insurance for just $4,000?
A - Even if you already have some coverage as part of your home & property policy, it's always best to take out enough self-employment insurance to cover the full value of your business property.
Q - I lease a photocopier for work. Is it covered by my self-employment policy?
A - Your insurance policy covers any property you own or use. That means your leased photocopier is covered. However, you should contact the leasing company to find out the actual value of the photocopier and check your lease contract to see if it already covers you.
Q - I have a self-employment insurance policy that excludes companies with multiple employees. Am I covered if I have an employee who comes to help me at home from time to time?
A - Since you only have one employee, the exclusion does not apply to you. The exclusion refers to multiple employees without giving a specific number, so you should discuss it with your broker or insurer right away. This way, if your business grows and you have to hire more employees, you'll know whether your policy is flexible enough for your new needs.
Q - Self-employment insurance covers computer data recovery. What exactly does this mean?
A - It means your insurer will reimburse you for your software and pay to have it reinstalled and your computer files recopied onto your system. The insurer will not, however, cover the cost of rebuilding your databases or re-collecting the data you accumulated over the years. It's very important that you make regular backups of your data and keep a security copy off the premises. This is what your insurer will use to get your system up and running again.
Q - I run a catering service out of my apartment. If I caused a fire while cooking, would I be covered?
A - Yes. The civil liability section of your self-employment policy protects you in cases like this. However, it's very important that you clearly describe the nature of your activities to your broker or insurer when you're purchasing your policy.
Q - I had a fire at home and can't work in the basement anymore. A colleague has offered to help out and let me use an office with telephone and secretarial services, but I would have to pay for them. Would these expenses be reimbursed?
A - Yes. The additional coverage section of your self-employment insurance deals with operating losses and covers this type of expense.
Q - Does self-employment insurance cover floods?
A - Unfortunately, flooding is not insurable either by home & property insurance or self-employment insurance.
But it is possible to get insurance for sewage backup, which can be particularly valuable if you work out of the basement of your home. So check your home & property policy for sewage backup coverage.
Q - Because of a power outage, I wasn't able to work for three days. Does my self-employment insurance cover my loss in revenues?
A - Sometimes yes, sometimes no. It all depends on the cause of the power outage. If your house was struck by lightning, you're covered. In any case, you should discuss it with your insurer right away.
Q - I work at home, but rarely have to go out to meet customers. Do I have to tell my insurer?
A - Yes, but if you purchase your auto and self-employment insurance from two different companies, it's your auto insurer you have to tell. If you use your vehicle for work, whether it's for making purchases, paying bills, or meeting clients, you have to report it. If your kilometrage is low, you'll obviously be charged much less that someone whose work keeps them on the road.
Q - Part of my work includes delivering very expensive tools and equipment to my customers. Does my self-employment insurance cover this?
A - Yes, self-employment insurance covers your business property when it's off the premises. Coverage is limited, however, to a predetermined amount.