Did you know that Quebec is one of the world leaders in entrepreneurial intention? More and more Quebecers are choosing to start their own businesses. Some choose to develop in large companies, while others prefer to start a business in the comfort of their basements with only a computer, some software, and a printer at their disposal. But what are the implications of their choice with regard to insurance policies? Do they have to notify their broker when they decide to get something off the ground at home? Are their new professional activities automatically covered? Finally, is their equipment covered under their home insurance policy? To learn the answers to these questions, keep reading!
DECLARATION OF RISK
First, as an insured person, you must notify your broker when your situation changes. When you decide to offer massages or develop computer programs at home, your insurer must be brought up to speed to add additional coverage, commonly referred to as “home business” coverage. It is of the utmost importance because some insurers may refuse to cover certain activities. Decisions about what is accepted vary based on the standards of each insurance company. By contacting your insurance broker, he or she can look into various options to find a solution in the event that your current insurer refuses to provide you with coverage.
Professional activities are not automatically covered. In addition, there are several conditions that must be respected if you want to add this coverage to your insurance policy. Some such conditions are that your business must be operated exclusively out of your primary residence, and that you can have no more than two or three employees. However, if the required conditions are not met, a business insurance policy may be an option.
In the event that your insurer agrees to cover your professional activities, it will usually offer several types of coverage: replacement value coverage for professional equipment, civil liability for the premises, accounts receivable, etc. Your work equipment will therefore be covered by home business coverage. “Aren’t I already covered by my basic policy?” you ask me. You are not wrong. However, this amount is usually limited to $4000 or $5000, depending on your insurer.
CIVIL AND PROFESSIONAL LIABILITY
Civil liability is involved, for example, if a client falls on your stairs while coming to a physiotherapy appointment. However, it is important not to confuse civil liability and professional liability. Generally, home business coverage does not cover professional liability. Even if the insurer agrees to cover your home physiotherapy services, it will not provide coverage if a mistake or error is made in your work activities. In that specific case, it would be the professional order’s insurance that would intervene to provide compensation.
In short, whether you do telework or are self-employed, it is always important to notify your broker. We will be happy to then provide you with insurance solutions that are adapted to your needs.