Westfield Logo
Customer Agent Pay Bill: 800.766.9133 800.766.9133 More Options

Billing questions?
Call us Mon–Fri, 8a–8p EST


Running a home-based business? take this insurance IQ test now.

So you're opening a home-based business—congratulations! You know you've arrived when you can make money and still stay in your pajamas.

However, while there's a lot that can go right, a few things can also go very wrong and threaten your business—so it's essential to make sure you're properly protected in all the right ways.

Enter insurance!

How high is your insurance IQ when it comes to a home-based business? Take this test to find out, and then check your answers at the bottom of the page.


  1. I have home insurance, so I don't need any additional coverage for my business. True or False
  2. If I fall and get hurt while I'm running my business from home, my personal health insurance will cover me. True or False
  3. Key person insurance protects my family in case something happens to me. True or False
  4. It's impossible to gauge risk for a home-based business, so always go with the highest coverage amounts possible. True or False
  5. I should still look into a business auto policy if I'm driving 90 percent for personal use and only 10 percent for business use. True or False
  6. A package-delivery person slips and falls on my steps and sues me. An umbrella policy will cover any injury claims they make. True or False
  7. If I'm unable to conduct business due to circumstances beyond my control, such as a fire or flood damage, or a national emergency, an umbrella policy will cover me and any losses, including loss of income. True or False
  8. If I lose business data due to a cybercrime or computer mishap, business insurance does not cover this. True of False
  9. Because my business and personal finances are separate, I can't be personally sued by my customers. True or False
  10. I can qualify for long-term disability insurance through my former workplace even though I'm now self-employed. True or False



  1. False. A home-based business will require some changes to your personal insurance policies. Look into a business-owners package policy if it's your primary source of income. In addition, you may need professional liability and/or business liability or protection for equipment.
  2. False. If your home-based business is not disclosed to your insurance company, your claim may be denied. Additionally, if you have employees on site, you may require workers compensation coverage for them.
  3. True. Key person insurance covers either the death or disability of a leader or employee who is difficult or impossible to replace.
  4. False. Different types and sizes of home-based business carry different risks. You don't want to pay so much that you're over-insured, and you certainly don't want to be under-insured in the worst-case scenario. Contact an agent to find out the best possible coverage for you.
  5. True. A business auto policy may cover situations that a personal auto policy does not.
  6. True. An umbrella policy can protect you from large claims that go beyond your regular coverage limits and can help pay legal costs—for example, if you're sued. It won't, however, cover intentional acts or criminal negligence.
  7. False. You'll want to look at business interruption insurance. For instance, 40 percent of businesses that are closed due to a flood never reopen, according to FEMA.
  8. False. Westfield offers a suite of cyber-protection products to help protect against fraud, extortion, data loss and more.
  9. False. If you don't properly separate your home and business entities, you may be sued. Make sure you have the appropriate business liability coverage so that your personal property would remain untouched in the unfortunate event of a lawsuit.
  10. False. Even if you were automatically covered at a former job, you may need to buy separate long-term disability insurance if you're unable to work.



0-4 correct answers: Study up, buttercup! The Insurance Information Institute has a good primer on what general coverage you'll need when you start an in-home business.

5-8 correct answers: You've got a good handle on what is and isn't covered for your home-based business. Different industries require different coverage, however. Find out more about how we can serve your particular home-based business.

9-10 correct answers: Congratulations! You have superior Insurance IQ. Connect with an agent to ask more specific questions and start your coverage today.

Vanessa McGrady is an award-winning journalist, social media strategist and communications professional. But wait, there’s more! She’s also been a playwright, actor, producer and voice-over artist. She can sing “Home on the Range” in Yiddish, which is apropos of nothing.

She is the author of Rock Needs River, a memoir.