Commercial · industry practice
Home-based businesses.
Etsy, freelancers, consulting, daycare, photography, baking. Most homeowners policies have a $2,500 business-property cap — which is often less than your laptop.
What it is.
Where homeowners stops covering the work. Etsy sellers, freelance designers, consulting, daycare, baking, photography. Most homeowners policies have a $2,500 business-property cap — often less than your laptop. The right answer is a small BOP for anything past hobby revenue, or at minimum a homeowners business endorsement. Either way: don't ride your homeowners alone if your business is real.
The lines in your policy.
Each one is its own knob. The carrier's default rarely fits a real life.
What a claim looks like.
Three anonymized files. Numbers are illustrative.
Freelance graphic designer's laptop and external drives stolen from home office. $6K in equipment + client files. Homeowners paid $2,500 (the business-property cap). Without inland marine on a small BOP, $3,500 came out of pocket.
Photographer's client visits home studio for portrait session. Trips on stairs, ER + ongoing PT: $14K. Homeowners denies — business activity exclusion. Small BOP with GL would have paid in full. Cheap policy avoided a personal lawsuit.
Home baker mislabels product, customer with peanut allergy has reaction. Defense + settlement: $32K. Product liability on cottage-food endorsement pays. Without coverage, potential personal-injury suit against the baker.
How to read a home-based policy.
The four things worth looking for on the dec page, in the order we read them.
The first page tells you who's actually covered, on what address, and under whose legal entity. A surprising number of policies have the wrong name, the wrong address, or a missing additional insured, and you don't find out until you file a claim. Cross-check it against your driver's license, your title or lease, and any contract that requires you to be insured.
Policy limits are abstract until you stack them against the assets they protect. A $300k liability limit feels generous in isolation; against a $1.2M home and a college fund, it isn't. Walk down each numbered line on your dec page and ask: if this were the cap on the worst day, would I be okay?
Page one shows you the base form. Pages four through twelve show you what the endorsements added, and, more importantly, what they took away. Water-damage exclusions, roof-payment schedules, named-storm deductibles, scheduled-valuables caps. These small numbered forms decide more claims than the headline limits do.
Carriers re-rate, re-form, and re-endorse policies at every renewal. If you keep last year's dec page, a side-by-side read takes ten minutes and tells you which limits drifted, which sublimits got cut, and which endorsements quietly disappeared. It's the single most useful habit in personal insurance.
Frequently asked questions.
When do I need a real BOP vs. a homeowners business endorsement?
Rule of thumb: if business revenue exceeds $25K-$50K/yr, or if clients ever visit your home, or if equipment exceeds $5K — you need a real BOP. Below that threshold, homeowners endorsement is usually adequate.
Does my homeowners cover business activities at all?
Most homeowners explicitly exclude business activities. The 'business pursuits' endorsement adds limited coverage but caps property at $2,500-$10,000 typically. Real business operations need real business coverage.
I'm just selling on Etsy. Do I need anything?
Depends on revenue and product type. Below $5K/yr in jewelry or clothing — homeowners endorsement is probably enough. Above that, or for any product with bodily injury or property damage potential (food, cosmetics, electronics, children's products), small BOP is the right answer.
What if I move into commercial space?
We restructure to a standard commercial BOP. Pricing usually goes up modestly; coverage broadens significantly. The HBB market is for in-home operations; commercial space deserves commercial coverage.
Want a second read on your home-based policy?
Send us your declarations page. You'll get it back marked up, in plain language, with the gaps and the over-coverage flagged, yours to keep, no obligation to switch.
or phone (913) 408-7280
We're an independent broker. We represent you, not the carrier , paid by the carrier we ultimately place with, but accountable only to the person whose name is on the policy. Read more about how we work.