What is Commercial Umbrella Insurance?

Commercial Umbrella Insurance provides businesses with additional liability coverage to help protect them against the potentially ruinous costs of claims. Significant assets can be at risk when businesses are the target of lawsuits. If the cost of a claim exceeds the limits of a business’s underlying primary insurance policies, Commercial Umbrella Insurance extends liability coverage for an additional layer of insurance to further protect business assets. Without Commercial Umbrella Insurance, business owners could be obligated to pay out of pocket for legal fees, medical bills, and damage expenses that exceed the limits of their underlying primary business coverages.
To help get the added protection your business needs, get a quote on Commercial Umbrella Insurance from Premier Insurance.

What does Commercial Umbrella Insurance cover?

A Commercial Umbrella Policy from Premier Insurance increases business liability protection when the costs of a lawsuit exceed the limits of the primary underlying business liability coverage. So, a commercial umbrella insurance policy will help protect a business when accidents such as the following happen:
  • A customer slips on a wet floor in your office and injures himself. The medical costs of the injuries exceed your general liability policy’s limits.
  • An advertising error results in major lawsuits against your business with costs that exceed your primary business liability insurance coverage limits.

Commercial Umbrella Insurance can be applied when a covered claim exceeds the limits of an eligible liability policy. Say your policy has already paid out $1 million for a claim, and that’s as much coverage as the policy can offer. However, you’re still liable for another $250,000. Your Commercial Umbrella policy can cover the remaining cost.

But this doesn’t mean you can put your Commercial Umbrella coverage toward every type of insurance policy. Just like a real umbrella, Commercial Umbrella Insurance can only cover a certain area. There are three underlying liability policies that fall under the protection of this policy:

  • General Liability Insurance.
  • Employer’s Liability Insurance.
  • Hired and Non-Owned Auto Liability Insurance.

This is important to keep in mind if you’re thinking about purchasing a Commercial Umbrella policy. Umbrella Insurance can only be applied to a claim if…

  • You have the appropriate underlying policy.
  • That policy’s limits have been reached.

Additionally, be aware that you might not be able to purchase a Commercial Umbrella policy unless the underlying policy has a certain limit.

To illustrate how Commercial Umbrella Insurance works, consider this scenario: a few visitors are injured on your business property. They all require trips to the hospital and expensive surgeries. They sue your business to recoup medical expenses and other damages. Luckily, you have General Liability Insurance and Commercial Umbrella Insurance.

Sure enough, your General Liability policy exceeds its $1 million limit after all the attorney fees, settlement expenses, and court costs are tallied. But you have Commercial Umbrella Insurance, which provides another $1 million in coverage. After your General Liability policy is exhausted, your Umbrella coverage takes care of the remaining expenses.

Excess Liability Policy

A policy issued to provide limits in excess of an underlying liability policy. The underlying liability policy can be, and often is, an umbrella liability policy. An excess liability policy is no broader than the underlying liability policy; its sole purpose is to provide additional limits of insurance.

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