Working from home is now a mainstream feature of New Zealand's employment and business landscape. Approximately 30% of NZ workers work remotely at least part of the time, and home-based sole traders and businesses form a significant and growing segment of the economy. But the shift from office to home has created genuine uncertainty around insurance — particularly public liability cover. Who is covered when, and for what?
Does Standard Public Liability Cover Home-Based Businesses?
Yes — but the specifics matter. A business public liability policy covers legal liability for injury or property damage to third parties arising from your business activities. If you operate from home, your business policy should cover incidents that arise from your business operations, regardless of whether they occur at your home office or at a client's site.
However, most standard policies have specific conditions or exclusions relating to home-based operations. The most common:
- The policy may require you to disclose that your principal place of business is your home — and if you fail to disclose this, a claim could be declined.
- Damage to your own property (your home) is almost always excluded — it falls under house insurance, not public liability.
- Injuries to employees working at your home may be covered under employers' liability (a separate section of many business policies) rather than public liability.
When a Client Visits Your Home
This is a scenario that often surprises home-based business owners. If a client comes to your home for a meeting and is injured — slips on your driveway, trips on your stairs, is bitten by your dog — your public liability policy should respond, provided the visit is clearly connected to your business activity.
However, your home and contents insurance may also have a guest liability provision, and there can be ambiguity about which policy responds first. The safest approach is to:
- Ensure your business public liability policy explicitly covers third-party visits to your home premises
- Inform your home insurer that you conduct business from home (failure to disclose this could affect your home insurance as well)
- Check whether your home insurer's liability coverage excludes business-related incidents (many do)
The Grey Zone: Home and Business Liability Overlap
Consider this scenario: you run a tutoring business from a dedicated room in your home. A student's parent slips on your front path on the way to pick up their child. Is this a home liability claim or a business claim?
In most cases, a business policy will respond because the visit was commercially motivated. But if your home insurer's policy excludes business-related incidents, and your business insurer requires you to show the incident arose from a specific business activity, there is a potential gap. The solution is straightforward: speak with your insurer and get explicit written confirmation that home-based client visits are covered under your business policy.
When You Are Working Remotely for an Employer
If you are an employee working from home rather than a self-employed person, your employer's public liability insurance is almost certainly not extended to cover incidents at your home. The employer's policy covers the employer's business premises and business activities — your spare bedroom is not a business premises in the policy's terms.
Practically speaking, this matters most in two scenarios:
- A colleague or work visitor comes to your home and is injured — their claim would likely fall under your own home contents liability cover, not your employer's business policy.
- You cause injury or damage to a third party while conducting work from home — the employer's policy may respond if the incident is clearly in the course of employment, but this is not guaranteed.
Employers who have employees working from home regularly should review their business insurance arrangements to confirm the position and should document their policy for employees.
Do You Need a Separate Home Office Insurance Policy?
Some insurers offer specific "home office" or "business in home" extensions that clarify the coverage position. These are worth considering if:
- You regularly receive clients or deliveries at your home
- You have employees working at your home, even occasionally
- Your work involves equipment, stock, or hazardous materials stored at home
- Your home-based work generates meaningful revenue (typically over $30,000 per year)
Key Questions to Ask Your Insurer
- Does my business public liability policy cover incidents at my home address?
- Am I required to disclose that my principal place of business is a residential property?
- Does the policy cover third-party injuries during client visits to my home?
- Is there any exclusion for incidents on residential property?
- Does my home insurance exclude business-related liability incidents?
Getting clear answers to these questions in writing ensures that if an incident does occur, there is no ambiguity about which policy responds.
Conclusion
Working from home does not automatically create an insurance gap — but it does require you to check that your coverage reflects where and how you actually operate. If you have not reviewed your business and home insurance since your working arrangements changed, now is the right time to do so.