The standard exclusion
Most homeowner’s insurance policies contain explicit exclusions for business activities. This means that if you operate any kind of business from your home — even part-time — your policy may not cover losses related to that business.
Common standard homeowner’s policies (HO-3, HO-5) typically exclude:
- Business property (computers, equipment, inventory) used for business purposes
- Liability claims arising from business activities on your property
- Professional liability for advice or services rendered
What’s actually at risk
If a client visits your home office and is injured, your homeowner’s liability may not respond. If your $3,000 camera used for a photography business is stolen, your homeowner’s policy may exclude it entirely — or cap the payout at $500–$1,000.
Your options
Depending on the size and type of your business, you have several options:
- Homeowner’s policy endorsement: For very small, low-risk home businesses, your insurer may offer an endorsement (add-on) that extends some business coverage.
- In-home business policy: A standalone policy specifically designed for home-based businesses with annual revenues under $250,000–$500,000.
- Business owner’s policy (BOP): Combines general liability and commercial property in one package, designed for small businesses.
The right answer depends on the nature of your business, the equipment you use, whether clients visit your home, and your revenue level.