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Direct Line, one of the UK’s largest insurers, has found that many small home based businesses are putting their business at risk by not taking out the correct business insurance. If your business was left unable to trade due to un-seen circumstances, without the correct business insurance, your home based businesses could loose money.

Direct Line have found that almost 30% of UK based home business don’t have any insurance for their business. Out of the total number of home based businesses that actually have business insurance, only a mere 12% actually have the correct cover.

The amount of home based businesses that take out public liability insurance isn’t a great deal better than those taking out business insurance. Only a mere 32% of businesses have public liability cover, which means that the other 68% are not covered if a claim was made against them or their business.

The reason why so many home grown businesses aren’t buying the correct insurance is because they believe it’s covered by their standard home insurance. When it comes to setting up a home business, the majority of people forget about getting office insurance when the entire operation is run out of their home, which is insured. However, many business owners will be shocked when they are turned away by their home insurer when they try to make a business claim. Many people see setting up a home business as being a cheap solution, however, if they were to setup say a salon, the would always think of getting salon insurance, but when it comes to setting up a home business, it can be forgotten.

Direct Line recommends insuring your home based business as soon as possible to cover yourself for any problems you may have in the future. That way, you will be covered if you ever need to make a home based business claim.

The head of Direct Line Business had this to say about the research findings. “With so few businesses being protected from a liability claim, or an unexpected pause in trading, this research highlights the need for business owners to think about specific business insurance. Without it, dreams of being a business owner could quickly become a nightmare.”