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Nearly fifty percent of all homes have some sort of home-operated business. These home-based businesses represent substantial investments of time, money and property and yet many business owners do not have the necessary insurance coverage because they think their homeowners' insurance policy covers all their home business needs. In fact, many homeowners' insurance policies provide only a limited amount of coverage for home businesses. Policies vary, but in most cases business equipment on the premises is covered for up to $2,500 and equipment away from the home is covered only up to $250. Besides offering only limited property protection, a homeowners' policy won't cover business-related liability or business interruption. Depending on the type of business the policyholder operates, they may be able to add an endorsement to their existing homeowners' policy. For a small sum of money they can double their standard homeowners policy limits for business equipment from $2,500 to $5,000. Some companies have also begun offering endorsements that include property and limited business liability coverage. Such endorsements however are typically only available for businesses that generate $5,000 or less in annual receipts. To make sure they are fully insured, home-business owners should purchase a separate business owners policy or buy a home business endorsement to their homeowners' policy. An insurance agent or insurer can help determine the type of coverage that best fits the consumers needs.
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