Short answer: Often yes. Homeowners and renters policies usually provide little or no coverage for business property and exclude liability arising from business activities. Personal auto policies may exclude some business uses, such as deliveries. Depending on your side business, a home business endorsement, a business owner's policy, general or professional liability, or commercial or rideshare auto coverage can fill the gaps.
Why your personal policies fall short
- Business property: standard homeowners forms commonly cap business property at home at a low amount and limit it further away from home. Inventory, laptops used for clients and equipment can easily exceed those limits.
- Business liability: homeowners liability coverage generally excludes injury or damage arising from business pursuits. A client who trips in your home office or a product that injures a buyer may not be covered.
- Auto: personal auto policies may exclude or limit coverage while you're delivering goods or carrying passengers for pay. See our rideshare and delivery guide.
Match coverage to the side business
| Side business | Coverage to consider |
|---|---|
| Online store or crafts | Product liability, inventory coverage, a home business endorsement or BOP |
| Consulting, design, bookkeeping | Professional liability (E&O), cyber |
| Personal training, tutoring, events | General liability; professional liability where advice is involved |
| Handyman or cleaning | General liability, tools coverage, commercial auto if you haul equipment |
| Deliveries or rideshare | Rideshare or delivery endorsement, or commercial auto |
Questions to ask
- [ ] Do clients or customers come to my home?
- [ ] What's my business property worth, at home and on the road?
- [ ] Do contracts or platforms require me to carry insurance or name them as additional insureds?
- [ ] Will I hire help? If so, check workers' comp rules by state.
Start small
Many side businesses can start with a home business endorsement on the homeowners policy, if the insurer offers one and the business qualifies. A business owner's policy adds more property and liability. Tell your insurer what you do. Undisclosed business activity is a common reason claims get disputed.
Bottom line
A side business usually needs at least a conversation with your insurer, and often a small policy. See home-based business insurance.
Questions? Contact Alishahi Insurance or call (877) 711-4545. Vea home-based business insurance.
Frequently asked questions
Does homeowners insurance cover my side business?
Usually only minimally. Business property is limited and business liability is generally excluded.
Does personal auto insurance cover deliveries?
Not always. Many personal policies limit or exclude delivery or rideshare use without an endorsement.
What is a home business endorsement?
An add-on some insurers offer to extend homeowners coverage to a small qualifying home business.
When do I need professional liability for a side business?
When you give advice or professional services, such as consulting, design or bookkeeping.
Alishahi Insurance · 439 N Canon Dr, Penthouse, Beverly Hills, CA 90210 · (877) 711-4545 · CA License #4348151. General information only. This isn't legal, tax or financial advice or a coverage determination. Coverage depends on policy language and underwriting, and rules vary by state.