Commercial Umbrella insurance
Commercial Umbrella is similar to commercial Excess Insurance And is tailored To specifically cover larger Liability Claims. Commercial umbrella insurance is an extra liability insurance policy that provides additional coverage beyond the limits of a company's primary general liability, auto liability, or other underlying insurance policies. It acts as a safety net, offering added protection against catastrophic events that may result in significant financial losses for a business.
Here is how it typically works:
Excess Coverage
When the limits of your primary insurance policies are exhausted due to a covered claim, the umbrella policy kicks in to cover the remaining costs, up to the policy’s limit.
Broader Protection
It may also cover certain liabilities that are not included in primary policies, offering a more comprehensive level of protection.
Cost-Effective
Generally, umbrella insurance is cost-effective in relation to the amount of coverage it provides. It’s a way to significantly increase your liability coverage without having to increase the limits on each underlying policy.
Various Business Needs
It’s particularly useful for businesses facing higher risks of liability claims, such as those in industries with inherent risks or larger-scale operations.
Legal Fees
Umbrella insurance can cover legal fees, court costs, and settlements beyond what your primary policies cover.
Requirement for Contracts
In some cases, business contracts or agreements may require a certain level of umbrella insurance coverage to mitigate potential risks.
Do you have specific questions about an Commercial Umbrella for your Business or need help finding the right coverage?
Get Help With Insurance, Inc. can quote your insurance with several carriers that that provide insurance coverage for liability, property and much more. Call us today.
Do you Need An Umbrella Policy for your Business?
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It’s impossible to predict whether you might lose a lawsuit resulting from a car accident or an accident on your property. Nor is it possible to predict the amount that might be awarded to the winning party, an amount that you would be responsible for paying. To protect yourself against the possibility of devastating financial loss from these unforeseen events, you may want to purchase business umbrella insurance.
Before getting an umbrella policy, businesses should assess their specific risks and liabilities to determine the appropriate coverage amount. It’s also crucial to understand what is covered and what is excluded within the policy.
Remember, while umbrella insurance provides added protection, it doesn’t cover everything. It’s essential to consult with an insurance advisor or agent who can guide you through the specifics and tailor a policy that suits your business needs.
Just like a personal umbrella policy, commercial umbrella policies increase liability limits for a business and offer more risk protection. It isn’t possible to predict the amount that might be awarded to the winning party, an amount that you would be responsible for paying after an accident.
What is Primary Coverage
Primary coverage is insurance coverage under which liability applies (or, in insurance parlance, “attaches”) immediately upon the happening of an accident or event (called an “occurrence”) that gives rise to liability. Primary insurance provides an initial or beginning layer of protection either on a first-dollar basis or after the application of a self-insured retention or a deductible.
The dollar amount necessary to exhaust the underlying limit and thereby trigger the secondary policy’s coverage is called the “attachment point.” In other words, the primary policy limits must be completely paid out so that there is no insurance left in the primary layer before the secondary policy steps in to provide further coverage.The Builders Risk Program by one of our carriers offers coverage for residential and commercial projects valued up to $75 Million.
Example of how a business umbrella policy would work
Let’s say one of your employees gets into a car accident while making a delivery to a customer. The property damage and bodily injury costs exceed your business’ commercial auto liability limits. If you don’t have a commercial umbrella policy, you’d have to pay the amount that exceeds your policy limit, putting your business at financial risk. That’s why it’s important to have umbrella coverage.
What is Umbrella (horizontal) Coverage
Business Umbrella/“Horizontal” Insurance Coverage Excess (or “vertical”) coverage can be defined as additional liability limits for a claim that is covered by an underlying primary policy. That means a claim that is not covered by a primary insurance policy would not be covered for purposes of the excess policy, either. In contrast, some secondary insurance policies reach out and cover more types of claims arising from more exposures than the ones covered by the underlying primary policy.
For example, suppose the primary policy excludes liability claims arising out of a particular kind of drug made by the insured, but the secondary policy covers any kind of product liability claim, even ones arising from that drug. In that situation, the primary insurer would not cover such drug claims, but the secondary insurer would. A secondary insurance policy’s providing coverage for “extra” claims can be thought of as “moving over” to cover additional risks that are not covered by the primary policy. A secondary policy that “spreads out” and provides coverage for additional types of claims that are not covered by the underlying is like an umbrella that opens up to protect a person from raindrops. That is why secondary policies that provide coverage for additional claims are called “umbrella” policies.
What is Excess (Vertical) Coverage
Excess/“Vertical” Coverage For claims that are covered by the primary policy, “excess coverage” is the additional coverage provided by the secondary policy above the primary policy’s limit. After the primary insurer pays its entire limit and exhausts the available coverage in the primary layer, the secondary policy takes over and provides additional coverage up to the amount of the secondary policy limit.
Excess coverage can be therefore thought of as coverage provided by an additional policy that simply raises the policyholder’s liability limit by an additional amount.
What is Follow Form?
Follow Form Excess Coverage “Follow form” coverage describes the situation where the secondary policy provides insurance with exactly the same terms and conditions as the primary policy (also called the “followed policy”). Follow form provisions simply state that the secondary policy will provide coverage according to the exact same terms, conditions, and exclusions as the primary policy. Providing exactly the same coverage in the secondary layer is beneficial because it minimizes the chances that a claim might not be covered by the secondary policy. True follow form excess policies only need to be a couple of pages long, relying on the followed policy for most of their governing terms.
What is Self-Insured Retention?
Self-Insured Retention is a dollar amount specified in a liability insurance policy that must be paid by the insured before the insurance policy will respond to a loss.
aka. deductible
How Much Umbrella Insurance Do I Need?
Having too much liability insurance is better than having too little. Use our calculator to determine how much umbrella coverage is right for you. It’s wise to have at least enough liability insurance to cover your net worth. Your Net Worth is Assets minus Liabilities.
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This is intended as a general description of certain types of insurance and services available to qualified customers. Any description of policy provisions is meant to give a broad overview of coverages and does not revise or amend a policy. Refer to the policy coverage form for a complete representation of the scope of coverage, terms, conditions, exclusions and more. The policy is the contract that specifically and fully describes your coverage. Some products may not be available in all states and may only be offered on a non admitted basis. Product availability is subject to change.
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