From Backyard Projects to Home Businesses: When Your Hobby Needs Insurance

Selling your handmade goods or turning your side project into a small business?

​Learn when your hobby crosses into business territory — and what insurance coverage you might need to protect it.

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🎨 When Passion Turns into Profit
​It often starts small — maybe you’re baking cupcakes for friends, crafting candles for local markets, or running a lawn service on weekends. But as your side project grows, so does your risk.

Many hobbyists don’t realize that homeowners insurance usually won’t cover business-related losses. Once you start earning money, even part-time, your “hobby” can legally be considered a business — and that changes everything from coverage to liability.

🏡 Why Homeowners Insurance Isn’t Always Enough
Your homeowners policy is designed to protect personal property and liability — not commercial activity.

That means if business equipment is stolen or a customer gets injured, your standard policy likely won’t cover it.
For example:

• If your candle business causes a fire in your home, your claim could be denied.
• If a client slips on your porch while picking up a custom cake order, your liability coverage might not apply.
• If you store business inventory in your garage and it’s damaged by a storm, that loss probably won’t be covered either.

💡 Quick Tip: If your hobby brings in more than $2,000 annually, it’s time to look into small business coverage.

💼 Types of Coverage for Home-Based Businesses
Depending on the nature of your work, you have a few coverage options:

1. Home-Based Business EndorsementThis is an add-on to your homeowners policy that provides limited coverage for business equipment and liability.
Best for: Low-risk businesses like consulting, freelance work, or small-scale crafting.

2. In-Home Business Policy
A step up from an endorsement, this policy covers business property, liability, and income loss if your home is damaged.
Best for: Businesses with client visits or product storage (like bakers, artists, or Etsy sellers).

3. Business Owners Policy (BOP)
A comprehensive option combining property, liability, and business interruption coverage.
Best for: Growing small businesses with higher inventory or regular customer interaction.

4. Commercial Auto Policy
If you deliver goods or use your vehicle for business errands, your personal auto policy won’t cover it. Commercial auto insurance protects you and your vehicle during work-related trips.

⚖️ When a Side Hustle Becomes a Business
You might think, “I’m not a real business owner—just doing this on weekends.”
But from an insurance perspective, if you:

• Advertise or promote your work,
• Accept payments for your products or services,
• Store inventory or use specialized tools, or
• Employ anyone (even part-time help)...

Then your insurer could view your activity as a business — not a hobby.

🧁 Real-World Example
Let’s say you start a home bakery and sell cookies at local markets. One weekend, your table display collapses and injures someone. Without business liability coverage, you could be personally responsible for medical costs — even if you never intended to run a full business.
A BOP or home-business endorsement could protect you from that kind of loss.

🛡️ Protecting Your Passion the Smart WayTurning your hobby into a business is exciting — and a sign of success. But before you scale, make sure your coverage grows with you.

At Corin Insurance Group, we work with multiple carriers to find affordable, flexible options that fit your needs — whether you’re a baker, maker, or weekend entrepreneur.

👉 Ready to protect your passion?
Visit www.corininsurance.com or contact us today for a personalized quote.

Disclaimer:
Coverage options vary by carrier and state. This article is for informational purposes only and not a substitute for professional legal or insurance advice.