In this uncertain economy more and more people are turning to self-employment as a way to take control of their own financial destiny. Unfortunately, many are risking financial disaster by operating without product liability insurance.
Product insurance covers both goods and services. Goods produced by home-based businesses include wood furniture, pottery, and baked goods while services include in-home day care, carpet cleaning, and lawn maintenance. All of these businesses, as innocuous as their products seem, are vulnerable to liability claims.
Micro Businesses, those employing up to six full or part-time employees and grossing less than $250,000 annually, are at even greater risk of product liability; yet many operate uninsured.
Misinformation is the most common reason new sole proprietorships risk operating without products liability insurance. There are no unannounced intrusive home inspections at inconvenient hours, though an inspection may be scheduled in some instances by mutual agreement. Premiums do not eat up profits; home-based sole-proprietorships can be covered for under $400 per year in many instances.
Having real control over personal financial destiny requires diligent risk management. The importance of product liability insurance for home-based businesses, sole proprietorships, and micro-businesses cannot be over-emphasized.