Does your insurance cover working from home?

The last few years have seen the trend for remote working really take off – ONS figures show that from September 2022 to January 2023, almost half (44%) of employees worked from home or did hybrid work.

But if you do spend some of your working week at home, are there any implications as far as insurance claims are concerned? And are we now all more at risk from insurers not paying out on home insurance claims?

Freelancers, small businesses and mobile workers may find insurers unwilling to pay out if their home and contents policies don’t cover work use – this means millions of people who work from home may soon have invalid insurance policies as cover for items such as laptops and phones may only be for domestic use.

What’s the problem?

During the height of the pandemic, nearly half (46.6%) of employees worked solely from home. This meant that the rules around working from home and insurance claims needed to be revised.

In the spring of 2020, the Association of British Insurers (ABI) outlined a number of pledges to support office-based workers who now had to work from home or needed to use their own vehicle to commute to work as a result of the pandemic.

These pledges have since been replaced with new permanent guidance to reflect the shift in working patterns.

How does remote working affect home insurance?

If you’re an office-based worker who now has at least part of your working week at home, you won’t need to get in touch with your insurer in the following situations:

  • Clients or customers visit your home – People visiting your home on business matters would previously have had public liability insurance implications. But the new rules mean you no longer need to let your insurer know if you have face-to-face client meetings from your home.
  • You make, sell or store products at your home – You no longer need to let your insurer know if your business makes or sells goods from your home or if you store any of these items at your home. If you make, sell or store hazardous or flammable goods (like fireworks or pressurised cannisters), it’s probably worth letting your insurer know.
  • You offer services from your home – If your beauty business pivoted from premises-based to home-based, you no longer need to worry about it affecting your home insurance. This also includes services like hairdressing, personal training, and child minding.
  • You’ve adapted your property – If you’ve remodelled your house to include an office space (maybe built an extension) or bought new business equipment that belongs to you (like a laptop or screen), this should still be covered by your employer’s insurance. If you’re unsure, check with your employer and your insurance company.

If you’ve set up a business from home, or if you’re planning to, you should get in touch with your insurer to find out what you need to do next. the same applies if you’ve moved your business from commercial premises to your home.

Take steps to make sure you’re still covered

Even though the rules have changed, it still makes sense to take the necessary steps to make sure you’re covered.

Jimmy Williams of Urban Jungle advises those working from home to make sure their home and contents policies cover them while they are working from home.

“Some insurers aren’t being very flexible and are insisting that domestic policies don’t cover incidents if people are working from home or if they are running a business. So, if you spill tea on your laptop while writing a work email, they might say: ‘you’re not covered’.

“When lockdown was in place, it would have been harder for insurers to draw a distinction between the office and home. But now, government guidance is different, it is easier for them to do so.

“We don’t think this is right as so many people are now working from home, either because going to the office doesn’t feel safe or because they are freelancing.”

Home working became the norm this year, with figures from the Office for National Statistics showing nearly half of the UK’s 32 million strong workforce worked from home during lockdown.

“There’s been a working from home revolution, and we all have to adapt to these new circumstances – that includes the insurance industry,” says Williams.

“We urge all Brits working from home to find out now if their policies are valid and contact their insurer if their circumstances have changed recently. Many won’t know about the ABI’s pledges changing on September 1st and how it may affect them, so it’s worth dropping your insurer a line.

“Having something in black and white is always a good thing. However, there are a lot of grey areas right now.”

How to work out if your insurance covers you?

Urban Jungle has created a simple flow chart for those working from home, to help people navigate their next steps. Williams also says, for some people, additional cover may be required.

“If you are doing clerical work, mostly working on a computer, then your home insurance usually covers that. But if you run a business out of your home that is public-facing then that’s probably different. Also, online sellers won’t be able to claim for stock which is damaged, lost or stolen.”

Urban Jungle’s Post-lockdown guide to working from home provides an insurer’s views of work during lockdown, describing the kinds of accidents people have had, as well as top tips for keeping your home working equipment safe.

Do you need business insurance when working from home?

If you’re unsure whether you need business insurance when working from home, check out our blog, here.