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HOME : Just the FAQs Ma'amHome Made LawsuitI work from home as a software consultant. An acquaintance asked if I would install some new computer equipment for her. I did it as a favour, since I don't normally do that kind of work. She paid me a small fee for my time. A few weeks after I had completed the installation, she booted up her computer and -- alas -- it crashed. She says the computer store told her all its computers are checked thoroughly before they are sold, so it must have been improperly installed. Now she wants me to pay for the repairs -- maybe even a new computer -- and is threatening to see a lawyer. But wait -- it gets worse! I thought I had liability coverage under my home-business insurance, and now I find out that it covers me only while I am working on the premises -- NOT after I have left! What gives? Someone got their
wires crossed, all right! Unfortunately for you,
you didn't have "completed operations" coverage -- an extension
to your home-business policy that takes care of liability that could arise
AFTER you have left a client's premises. If you supply a
product, or install or service something, liability can rear its ugly head
at any time, as you know all too well. While your particular home-business
coverage protects you while you are working, completed operations coverage
kicks in if injury or damage occurs after your work is finished and your
client starts to use whatever you were working on. It will also pay to
defend you in a claim. Maybe the computer crash wasn't your fault at all,
but was caused by something else. This coverage would take care of your
legal defence, and would also pay the damages if you were ultimately found
liable. Depending on your line
of business, you may need other kinds of liability insurance as well. For
example, since you are offering advice in your capacity as a consultant,
you should have "errors and omissions" coverage. This is often
available through professional associations. To cover all your
bases, you should explain to your insurance provider exactly what your
home business entails. Many home-office workers don't even have business
insurance, mistakenly thinking they can rely on their homeowners coverage
to protect them against business liability. Not so! Let's say you pay a
social visit to an acquaintance. You move a heavy desk for her, damaging
her valuable Persian carpet in the process. Because you were visiting for
personal reasons, your homeowners policy would protect you against
liability. If, however, you were there for business reasons and the same
thing happened, you would need business insurance to provide you with the
same protection. The same holds true if
a visiting client tripped on your loose floorboard, fell, and broke her
hip. Again, you would need business coverage to protect you in the event
of a liability claim. Don't leave your home
business open to a lawsuit. Cover your assets! Note: Remember, policies vary, so when in doubt, Contact Us. |
