Trouble is, many of the estimated 11 million owners of home-based businesses nationwide don’t bother to obtain additional coverage, insurance experts say.

“They think their homeowner’s or renter’s policy will cover them — that’s usually not the case,” said Jeanne Salvatore, spokeswoman for the Insurance Information Institute in New York.

A typical homeowner’s policy provides only $2,500 worth of coverage for business equipment, which is barely enough to handle the cost of most high-end personal computers and printers. The typical policy also doesn’t cover liability should someone become injured on your property during business hours, for example, and it certainly won’t include reimbursement for interrupted business.

To adequately insure a home business, owners have three basic choices: obtain endorsements, or added coverage, to their existing homeowners policy; buy a policy that specializes in in-home business; or buy a policy for small businesses.

The first option is often only recommended for the smallest of home businesses — that is, businesses generating $250,000 or less in annual receipts. Those who might fall into that category: freelancers or consultants working largely out of a home office.

Depending on the type of business being operated, you may be able to double your standard homeowner’s policy limits for business equipment from $2,500 to $5,000 for as little as $14 a year. Additional liability coverage of $1 million or more may be purchased for around $200.

Keep in mind, however, that homeowner’s policies exclude flood coverage, so if your business is located in a flood zone, you’ll likely need to buy a flood insurance policy from the National Flood Insurance Program.

“Talk to your agent first to find out what coverage you already have and what you will need,” Salvatore said.

In-home business policies provide more comprehensive coverage. For about $200 a year, you can insure your business property for up to $10,000. General liability also is included, but business owners can purchase up to $1 million more for an additional fee.

Salvatore also recommends individuals in certain professions obtain professional liability coverage.

“A lawyer or a psychologist working out of the home, for example, will need it,” she said.

One of the big advantages of in-home business policies is that they provide business-interruption coverage for those who may be unable to operate a business because of damage to their home. That includes lost income and ongoing expenses such as payroll for up to a year. The policy also provides limited coverage for loss of valuable papers and records, accounts receivable, offsite business property and use of equipment.

But not everyone can obtain this policy, since not all states permit its sale right now, according to Salvatore.

“It’s relatively new,” she said. “We’ve seen more and more of them in the last couple of years … (as) the number of people who are starting business out of their homes has been increasing.”

She says such policies are ideal for people with part-time home businesses.

For those with more involved operations or whose livelihood depends on a home business, business owners package (BOP) policies are recommended since they provide more extended coverage.

BOPs, like in-home business policies, cover business property and equipment, loss of income and liability. However, they’re on a much broader scale.

They’re ideal for home-based businesses that operate out of more than one location or manufacture products outside the workplace.

And speaking of venturing outside the home, if you’re using a personal vehicle for business activities, such as transporting supplies or visiting customers, you’ll also need to check whether your automobile policy also covers accidents which may occur while on business.

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