Canada is home to millions of small businesses. Some businesses start in garages, spare rooms, basements, home offices, or even the occasional patio. Humble beginnings are common, but having the right insurance coverage can help protect your small business and can even expand as your business grows.

Home-based businesses can take several forms, so the types of coverage you need might differ from other home-based businesses. It‘s also important to know that standard home insurance policies can‘t adequately cover many types of business risk, although some insurers offer riders that can help protect home-based businesses. Here are some coverage types to consider and how they can safeguard your business.

General liability insurance: Accidents happen and general liability insurance can protect your business against several types of liability, including bodily injury to others as well as claims for libel or slander and damage to the property of others.

Commercial property insurance: Most home insurance policies limit coverage for business equipment kept at your home. A commercial property insurance policy can protect your equipment, inventory, supplies, and more.

Business owners‘ policy: A business owners‘ policy combines both general liability insurance and commercial property insurance in an easy-to-manage policy. In many cases, purchasing a business owners‘ policy is more cost effective than purchasing the 2 policies separately.

Professional liability insurance: If your business gives advice to others, consider getting professional liability coverage. Also known as errors and omissions (E&O) insurance, this coverage protects your business if your actions (or inactions) cause financial harm to someone else.

Product liability insurance: Businesses that make, distribute, or sell products can consider product liability insurance. Even well-designed products can fail or be used in an unsafe manner, possibly leading to lawsuits or even legal judgements. Your product liability insurance can help protect your business assets and future earnings.

Cyber liability insurance: Hackers never sleep and home-based businesses can encounter risk in several ways. In some cases, customer information can be vulnerable. In other cases, you or a worker can unwittingly transmit a computer virus to another person or company.
-Cyber liability insurance can help cover the costs associated with several types of digital risk.

Every business is a bit different and some home-based businesses may need additional types of coverage. Just reach out to your broker to have a candid conversation about your business needs. Rest assured, if there‘s a risk, there‘s an effective way to insure it.


Sources: Insurance Bureau of Canada