How does running a business from home affect your insurance?

Running a business from home is common in Australia, with over 1.3 million “household” businesses recorded by the Australia Bureau of Statistics during FY25. The home office setup can give business owners flexibility and affordability, but it may also create unintended risk for your business and your personal property.

Check whether your business is covered

Home insurance generally protects the building (your house) and personal belongings against risks such as fire, theft, or storm damage. However, it may not cover business activities.

Most home and contents insurance policies do not cover business-related risks. This includes events such as:

• Client injuries on your premises
• Damage to stock or equipment
• Loss of income due to business interruption

Relying solely on a home building and contents policy may leave these and other areas unprotected. Business insurance specifically designed for home-based operations can help cover these gaps.

Can a home business affect my current home and contents policies?

Running a business from home could also change how your insurance applies to property, assets, and liability. For example, if clients visit your home office, stock is stored in your garage, or high-value equipment is used in your backyard, insurers may treat your property as a commercial location.

In a worst-case scenario, your home and contents policies could be cancelled if you try to make a business-related claim. Having separate business insurance cover can help you protect your business, while keeping your home protected as well.

How BizCover can cover your business

Having the right combination of policies for your business could help ensure that your business activities at home are fully protected.

• Public Liability insurance – Covers legal fees and compensation costs if a customer, member of the public, or a supplier claims against you for injury or damage to their property as a result of your alleged negligent business activity.
• Professional Indemnity insurance – Covers you for losses claimed by a third party and defence costs due to alleged or actual negligence in your professional services or advice.
• Portable Equipment cover – Covers you for loss and damage to your tools and stock due to theft, fire and other perils listed in the wording.
• Business Interruption cover – Covers loss of income following an interruption to your business following an insurable event.

Common home-based business types and common cover

Business Type	Common cover options	Notes
Freelance Consultant / Advisor	Professional Indemnity, Public Liability	Covers advice errors; client visits if home office meetings occur
Online Retail / E-commerce	Portable Equipment, Public Liability, Product Liability	Protects stock and equipment stored at home, plus liability from sold products
Creative Professionals (Designers, Photographers)	Portable Equipment, Public Liability, Professional Indemnity	Covers expensive cameras and computers; liability from client interactions
Health & Wellness Practitioners (Massage, Therapy)	Public Liability, Professional Indemnity, Business Interruption	Required if clients attend home premises or services are provided remotely
Trades or Contractors with Home Base	Public Liability, Portable Equipment	Covers tools stored at home; client-related liabilities

The importance of risk management and documentation

Documenting your home office setup and separating personal assets from business assets could help reduce disputes during claims. Keeping a record of equipment, stock, and client visits may help insurers assess your cover accurately.

What to consider when running a home business

Other considerations you may want to make when running a home business include:

• Confirm local council regulations and zoning rules for home-based businesses
• Ensure any modifications or equipment additions comply with building and safety standards
• Review both home and business policies regularly to reflect changes in operations