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⊸ Business Insurance⊸ Home-based Business Insurance

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Written by Nolan Wilson Updated on October 17, 2025 min read

Insure your home-based business for a lower rate

You still need insurance if you run a business out of your home. Sure, operating a home-based business can be a sweet gig. You have greater flexibility, no commute and a better overall work-life balance. So, it's important to protect your business (and your home) with proper coverage.

Don’t make the common mistake of assuming you’re covered under your home insurance. You’re not. Business activities are excluded from all homeowner's policies.

With ThinkInsure, we can find you the most affordable quotes and coverage from the top insurers in Canada. Speak with one of our advisors to get a quote and ensure your business is insured properly.

Top takeaways about home-based business insurance

  • Your home insurance policy does not cover business activity.
  • Home business insurance is not mandatory, but without it, you are financially liable for any damages caused to your home, business, or customers.
  • If you have a dedicated business space, have clients visit your home, or store inventory on your property, you should have a home-based business policy.
  • You can insure your home business by adding an endorsement to your home plan or by getting a standalone home-based business insurance policy.

How to get home-based business insurance

Insuring your home-based business is quick and easy. Tell us about the type of business you operate. We’ll help you compare quotes and choose the right plan.

Quickly provide your details
Provide your home-based business insurance details

Tell us a bit about your operations and coverage needs.

We will search for the best savings
We’ll compare quotes from the top insurers

We’ll compare options and packages from the top insurance companies.

You select lowest price and buy your policy
Choose the lowest quote

You select the lowest premium and then get insured.

What is home-based business insurance?

Home-based business insurance is designed specifically for sole proprietors, self-employed individuals, and businesses with one or two employees that operate out of their home or dwelling. It provides coverage for equipment, the area of your house used for business, and additional protection against other threats. It's a specific type of commercial insurance meant to work in conjunction with a homeowners policy.

Who should have a home-based business insurance policy?

Any person who runs a business out of their home should seriously consider home-based business insurance. It's essential to have coverage if:

  • You have customers or clients visit your home
  • You have inventory stored at home
  • You have expensive equipment to run your business

Some of the most common professionals who work from home are in marketing, IT, communications, professional services and contractors.

Why do you need home-based business insurance?

You can never have too much protection. Without home business coverage, you could put your property and other personal assets in a compromising situation. Liability is your biggest threat as a business owner. This coverage is a must-have if clients and employees come to your home.

Here’s why you need home-based business insurance:

  • Your home insurance doesn't cover business actions
  • It protects against a wide variety of liability risks
  • To keep your home and business separate entities
  • Financial protection
  • Peace of mind

What does home-based business insurance cover?

Woman working from home business doing paperwork

Home-based business insurance covers you against common commercial perils. You have coverage to protect from common threats associated with business operations. Get protection for:

  • Theft
  • Damaged equipment
  • Customer slip and fall
  • Customer property damage
  • Lawsuits
  • Company property
  • Closures
  • Product and service liabilities
  • Lawsuits and settlements
  • Damage to your home resulting from business actions

How much does home-based business insurance cost?

Rates can start as low as $500 per year and go up from there. For some business types, you can add an endorsement to your homeowner's policy for as little as $50 and up.

Many factors impact premiums. For example, adding a rider to your home insurance or taking out a separate policy can affect premiums. Costs vary depending on the type of business you operate. Your annual revenue, profession, product and service offerings, claims history, equipment, and more can all impact premiums.

Types of home-based business insurance coverage

More and more people are working remotely and running businesses out of their homes. Insurance companies are creating affordable packages that meet a variety of home-based business needs.

There are three main types of coverage to consider :

Icon of home and woman

Liability insurance for home-based business

This protects your assets from damage or loss. An accident or an injury claim may be very costly without liability insurance. It protects you from third-party claims due to injury on your property or caused by a product you sell.

Icon of home and computer

Home-based business contents insurance

Think about your office. Imagine that you had to replace your laptop, printer or office furniture. What if your equipment were damaged? This insurance lowers the threat of loss or damage to assets you need to operate.

Icon of judge's gavel

Legal expenses insurance

Any business can face a lawsuit or legal issues. Legal expenses insurance protects you against these and other costs.

Other types of insurance for your home business

What are the different ways I can insure my home business?

There are several ways you can insure your home-based business. Here’s how home business insurance coverage works:

  1. Add an endorsement to your home plan: Add a rider to your existing plan. This is ideal for freelancers and part-time business owners. It provides the least protection, making it ideal for low-risk operations.
  2. Get a home-based business insurance policy: Take out a standalone policy. This will cost more, but will give you more protection. This is ideal if you have clients come to your location or if you have inventory on hand.
  3. Commercial home business insurance: This is the most comprehensive option. It is the same as Ontario small business insurance, but offers more flexibility and solutions. It is ideal if you have multiple employees and more perils.

Home-based business insurance policy tips

Woman working from home business getting packages ready
  • Get insured: Insurance tends to be an afterthought for many home business owners.
  • Don’t make assumptions: Don’t make assumptions about what may or may not happen with your business or the type of insurance you will need. Consider all options with an open mind.
  • Get the right level of insurance: Not all home-based businesses need all types of insurance. For example, if you don’t use your vehicle for business, you don’t get that type of plan. Choose a package that is specific to your needs.
  • Get professional advice: Commercial insurance brokers provide invaluable guidance. Use this resource to make an informed decision about your insurance.
  • Shop around annually: Get a quote each time your policy is up for renewal. This allows you to reassess and ensure you have the right amount of coverage.

Home-based business insurance claims examples

  • Example #1 - Slip and fall: A customer visits your shop in your garage. They trip over some equipment and are injured. With home business coverage, you’ll be covered if they decide to sue. Without it, your home policy won't cover you, leaving you at financial risk of a lawsuit.
  • Example #2—Break-in: Your home has been broken into. Thieves took thousands of dollars of computer equipment from your home office. You don't have a business policy, and your home insurance won't cover the loss, so you will have to pay out of pocket to replace your equipment.
  • Example #3—Equipment causes fire: You are working in your shop in the basement of your house. A piece of equipment malfunctions and causes a fire, causing extensive damage to your shop and parts of your home. Fortunately, you have a home business policy, so your insurance will cover the damage.

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Home-based business insurance FAQs

There are no insurance requirements for home-based businesses in Ontario or Canada. However, you are required to notify your insurer if you are running a business out of your home. You could void your homeowner's plan if you fail to tell your insurer about your home business. While it’s not legally required, it’s highly recommended. Without it, you would personally be responsible if something happened.

Your Ontario home insurance may offer minimal protection for a business. It will not cover expensive work equipment, computers, product inventory, legal expenses, or liability.

Your homeowner's policy will not cover you against lawsuits related to business dealings. You won't be covered if your business possessions are lost, damaged, or stolen.

Working remotely from your home and owning a business are two different things. You do not typically need a plan if you work from home. However, there may be instances where it is recommended. Speak with your employer and insurance advisor to assess your needs.

Yes. All self-employed individuals should consider home-based business insurance if they work at home.

Even if you only run your business part-time, it's recommended that you have some commercial coverage to protect yourself financially. All it takes is one mistake or oversight and you could find yourself in legal trouble without the safety net insurance offers.

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Get a home-based business insurance quote today

Make sure your home business operation is protected at all times. We’ll help you get affordable coverage for your home-based business. Speak with a ThinkInsure expert today. Call 1-855-550-5515 or get started online.

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Nolan Wilson

Content Marketing Manager

Nolan is a content marketing manager and writer at ThinkInsure. He has 15+ years of experience in the insurance industry, working with brokerages and direct insurers to create compelling insurance content, specializing in auto, home, and commercial.

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