Does Working from Home Impact my Home & Tenant Insurance?

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Article Contents
Picture of By <span>Matthew Roberts</span>
By Matthew Roberts

Updated on January 10, 2025

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Picture of By <span>Matthew Roberts</span>
By Matthew Roberts

Updated January 10, 2025

Visit author page

5 minute read

Article Contents

Remote work continues to be embraced by Canadian workers thanks to shortened commute times and better work-life balance. The COVID-19 pandemic accelerated the shift to working from home (WFH), with approximately 20% of Canadians working most of their hours from home. This change in work arrangements, however, has led to murkiness about coverage for remote workers, whether through an employer’s policy or personal coverage.

Home and Tenant Insurance for Canadians Working from Home at a Glance

  • Most home insurance policies allow for some degree of remote work without significantly impacting coverage for a traditional employee, but those who operate home-based businesses may need additional coverage.
  • Employees should clarify with employers what protections are in place regarding company property and potential injuries sustained while working from home.
  • Renters who work remotely should be aware that tenant insurance may not cover business-related items unless specified in the policy.

Read on to find out how working from home can impact your home or tenant insurance. Learn more about the risks that remote workers should get coverage for, employer liability for WFH employees, and what additional coverage to get depending on your work situation.

Risks Faced by WFH Employees

Working from home introduces unique risks that can affect both personal property and liability coverage. Some of the primary risks include:

Damage, loss, or theft of company property:

If an employee accidentally damages, loses, or is robbed of equipment provided by their employer while working from home, it’s important to know if this is covered by the employer’s insurance policy or if personal insurance might apply.

Liability issues:

If clients visit a home office and suffer injuries or property damage, this could lead to liability claims against the homeowner. While standard home insurance policies have personal liability coverage, these policies may not cover such work-related incidents unless specifically included.

Data security and privacy:

Remote work also often involves sensitive information that may be transmitted through public networks or less secure apps, making data breaches a significant risk. While this may fall outside traditional property insurance, it’s worth considering additional cyber liability coverage if sensitive client data is handled.

Will My Home Insurance Cover Working From Home?

The answer to whether your home insurance covers working from home largely depends on the nature of the work being done. Are you a traditional employee or self-employed? Here’s a breakdown of what your home insurance will cover depending on the work you do:

Most standard homeowners’ policies will cover incidental work-related activities conducted at home. However, if employees are using company equipment like printers or company phones, they should confirm whether these items are covered under the employer’s policy or need additional personal coverage.

If you’re running a business from your home, you need to inform your insurer about the nature of your work as this may increase the risk of providing home insurance and the likelihood that you’ll file a claim. Many insurers offer endorsements that can be added to existing policies to cover business-related assets and liabilities.

Will My Home Insurance Cover Working From Home

Standard home insurance has coverage limitations, even with added limits for business property. The offered amount in your policy may be insufficient for more extensive operations or valuable equipment, so consider looking into getting a separate commercial policy to keep you covered.

Will My Tenant Insurance Cover Working From Home?

Also known as renters insurance, tenant insurance typically provides coverage for personal liability, as well as loss or damage of personal belongings due to risks like fire or theft. If you are working from home and using personal equipment like a laptop, these items may be covered under your tenant insurance policy. However, this coverage often has limits and may not extend to items used primarily for business purposes.

Likewise, tenant insurance won’t cover you if you’re running a business from home or conducting significant work-related activities – you’ll need additional coverage for that. Given the limits of standard tenant insurance regarding work-related activities, remote employees should consider getting endorsements for home-based businesses to prevent out-of-pocket expenses.

What If I Don’t Tell My Insurer I’m Working from Home?

Simply put: do not do this. Always inform your insurer if you have a WFH arrangement. If insurers find out about undisclosed WFH arrangements after a claim has been made, they may adjust future premiums based on perceived risk factors associated with remote work. This could lead to increased costs for coverage down the line.

Failure to disclose that you’re running a small business or working from home won’t just result in pricier insurance – it can lead to denial of a claim or even termination of your home or tenant insurance policy.  For example, if a fire damages your home office equipment and you haven’t disclosed that you work from home, the insurer may deny your claim based on the grounds of non-disclosure. This could leave you personally liable for any property damage or loss or liability claims.

Are Employers Liable For Employees Working from Home?

Employer liability concerning remote workers can be complicated. Recognizing the risks that WFH employees still face is key to ensuring that they’re protected, whether through personal insurance or company policies. Here’s a closer look at what employers are typically liable for when it comes to their WFH employees:

Company property protection:

Employers typically maintain liability for company property used by employees at home. If an employee’s work laptop is stolen or damaged while at home, it’s usually covered under the employer’s business insurance

Workers’ compensation:

If an employee gets injured while performing work duties at home, they may be entitled to workers’ compensation benefits. This includes injuries sustained in designated work areas within the home office setup.

Client interaction:

If clients visit a remote worker’s home office and get injured or damage occurs, liability may fall on the homeowner unless specific arrangements have been made through the employer’s insurance policies.

These are just some of the risks that employers should handle in some capacity for their remote employees. Employers should clearly communicate their policies regarding remote work and ensure that employees understand what protections are available, so they can get riders for coverage gaps.

Should I Get Additional Insurance If I Work from Home?

If you’re a freelancer or a small business owner operating from home, your standard homeowner’s insurance may fall short of providing adequate protection. Depending on your needs, you may opt for a home-based business insurance rider to your existing policy or get a separate policy for your business.

Here are some considerations and types of coverage to keep in mind:

This add-on can provide the necessary coverage for business-related equipment and liabilities incurred during operations conducted at home. This may be a cost-effective solution for small businesses that don’t need a lot of commercial space to operate, but still need protection against risks associated with running a business.

This type of insurance can cover lost income and ongoing expenses for home-based businesses, offering a much-needed source of funds if you can’t operate due to property damage from events like fires or floods. Without this type of coverage, a natural disaster can significantly disrupt your operations and jeopardize your business’ bottom line.

Depending on the nature of the business, separate commercial insurance policies may be necessary. These can include:

  • Commercial property insurance: This protects your business assets, such as equipment and inventory, from risks like theft and fire. Standard homeowners’ insurance may not cover these items adequately if they are used for business purposes.
  • General liability insurance: This is essential coverage for claims of bodily injury or property damage that occur during business operations. For example, if a client visits your home office and gets injured, this insurance can help cover medical expenses and legal fees.
  • Professional liability insurance: Also known as errors and omissions insurance, this coverage is key for businesses that provide professional services or advice. It protects against claims of negligence or failure to deliver promised results.

Consult with your insurance company to determine what types of coverage are essential for your business activities. Each business has unique risks that may require tailored solutions to ensure comprehensive protection.

Key Advice from MyChoice

  • Always inform your insurance provider about your remote work status and any changes in your employment situation to ensure adequate coverage.
  • For self-employed individuals or those running businesses from home, consider adding endorsements or separate commercial policies tailored to your specific needs.
  • Understand your coverage limits and review your policy carefully to understand what is covered when working from home – especially regarding equipment and liability related to client interactions.

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