What is Umbrella (Excess) Insurance?
Umbrella (Excess) liability insurance protects you when accidents happen and your existing liability insurance policies cannot cover all the expenses. Essentially, it picks up where your business auto liability, general liability or other liability coverage stops, providing extra protection against bodily injury and/or property damage.
Who Needs a Commercial Umbrella Policy?
You might consider a Commercial Umbrella Policy if…
- You need more protection and are on a budget.
- You want to sign a big client who requires more liability insurance.
- You have lots of foot traffic or contact with the public.
- You worry about the exclusions in your other liability policies.
What Does Commercial Umbrella Insurance Cover?
If you have any (or all) of these three qualifying policies – General Liability Insurance, Employer's Liability Insurance, or Commercial Auto Liability Insurance – a commercial umbrella can boost your coverage.
|Umbrella Insurance Can Increase Coverage For:
||Umbrella Insurance Cannot Cover:
- Professional Liability Lawsuits
- Employee Discrimination Lawsuits
- Lawsuits over third-party property damage
How Does Commercial Umbrella Insurance Work?
A commercial umbrella policy serves two purposes:
- It expands the limit that your company already has in its existing, or underlying, liability policies. If your general liability policy offers $1 million coverage per occurrence or $2 million total, you could expand those limits to $3 million per occurrence and $4 million aggregate with a $2 million umbrella policy.
- It broadens coverage for things that your underlying policies may not cover. If your auto liability policy covers accidents that might occur in a specific area, an umbrella policy could expand the coverage territory.
Is There a Difference Between Excess and Umbrella Coverage?
Yes. While both pay after the primary coverage is exhausted, Excess conforms to the exact coverage of the primary coverage, while Umbrella tends to have broader coverage and may have additional coverages that the primary insurance never had. EX: Most General Liability Insurance policies don’t include Liquor Liability Insurance, but a Commercial Umbrella policy might.
What Info Do I Need to Get a Quote?
- Declaration page of your current General Liability and Commercial Auto insurance policy (if you have them)
- Any prior losses your company has experienced. (A loss doesn’t necessarily mean your premium will be higher. Carriers evaluate each customer and loss event on a case-by-case basis)
- List of company officers and their positions. (Typically, the more experience and more successful the company’s overall record, the better the risk for the insurer – and the lower the premiums)
- Annual sales and payroll (along with the number of full-time and part-time employees, and/or subcontractors or consultants)
- Details of your companies current and future operations.
- Be sure to mention whether you carry professional liability, errors or omissions liability, liquor liability, employee benefits liability or employment practices liability insurance.
3 Key Takeaways about Commercial Umbrella Insurance:
- You can't buy Umbrella Insurance without having at least one other policy. You need to have General Liability, Employer's Liability, or Commercial Auto before you can get Umbrella coverage.
- Umbrella Insurance doesn't work with Professional Liability Insurance. While it does boost three other policies, Umbrella Insurance can't help out with professional liability claims.
- Umbrella Insurance comes in $1 million increments. Small-business owners can increase their lawsuit protection in $1 million increments through Commercial Umbrella Insurance.
Still have questions? We can tailor a commercial umbrella policy to fit the needs of your business. Talk to a Builders’ Choice agent today!