Commercial Umbrella Insurance
What is commercial umbrella insurance?
Commercial umbrella insurance provides an extra layer of liability protection on top of your underlying policies. A commercial umbrella policy can sit on top of general liability, commercial auto, or workers’ comp insurance. It also may be required by some vendors.
What does it cover?
Commercial umbrella policies will increase liability coverage to provide extra funds for payouts in the event of a substantial claim. It doesn’t cover what your underlying policy can’t cover. These policies are typically “follow form”, so if a loss is covered on your underlying policy and exceeds the liability limit, this is where the commercial umbrella would kick in. This could include types of liability such as product liability or customer injury.
In a claims scenario:
Your employee is driving one of the business vehicles and is found at fault for the accident. The other party sustains injuries and sues for $1.5 million. Your business auto policy has a liability limit of $1M. Where will the extra $500,000 come from? This is when your commercial umbrella insurance would kick in.
How much is it?
Premiums vary depending on the coverage you need and your industry type.
