4 Important Points of a Commercial Umbrella PolicyPosted on Jan 17, 2017
A commercial umbrella policy is designed to provide coverage when you have expenses that are not covered by your current liability insurance policy. This type of insurance basically ‘picks up’ where your business liability coverage stops and provides you with extra coverage for property damage and bodily injury.
For most situations, your standard business liability policy will cover you for more serious accidents and situations, however you will want to ensure that you protect your business by taking out commercial umbrella insurance.
Years ago, many larger companies were really the only ones that required commercial umbrella insurance. These days, however, more and smaller business owners are beginning to see the importance of this type of coverage.
With that said, here are four important points you should know about commercial umbrella insurance.
1) Umbrella Coverage is Good for Any Business
Whether you own a small or large business, you can only benefit from commercial umbrella insurance since your business, regardless of its size, is always at risk of an unforeseen and devastating event. All it takes is for one of your customers to slip and fall, injuring themselves and you have a potential liability lawsuit on your hands. This could result in you having to pay out money for damages, medical expenses and more.
Even though you have liability coverage in place, it may not fully cover the payments in a lawsuit like this. There may be a need for additional protection that an umbrella can provide. With commercial umbrella insurance, you will be covered above and beyond the limits of your business liability insurance and will have that extra coverage.
2) Covers Additional Liabilities Your Policy Doesn’t Cover
A commercial umbrella policy will kick in to cover losses or damage that your primary general liability policy won’t cover. In insurer’s language, this type of policy ‘drops down’, covering your liability as the main insurance. This tends to happen with coverages that are not included with your general liability plan. Advertising liability is a good example of this.
3) It’s Imperative to Have if You Have Employees Who Are Subject to Certain Risks
Do you have employees that are at risk of getting injured while working at their jobs? If so, serious work injuries may trigger employee lawsuits, which can easily exhaust employer’s liability coverage. Similarly, do your employees use their own cars to carry out work responsibilities? If so, and they are involved in a serious accident, your auto insurance coverage might not be enough to settle a claim or lawsuit.
4) You Can Have Your Umbrella Policy Customized for Your Business
Most commercial umbrella policies can be tailored and customized to meet your business needs. When you are discussing your umbrella policy needs with us here at Otterstedt Insurance Agency, be sure to let us know all of your specific business needs so we can customize it specifically for this.
You might have to provide us with certain information in order for us tailor your umbrella policy to your specific business needs. Some information we may need include:
- Your business operational and financial details
- Your current general liability declaration page
- Breakdown of your employees and your annual payroll
- Any past losses your business may have experienced
When talking with us, be sure you let us know if you carry any employee benefits liability, liquor liability, professional liability, employment practices liability or errors or omission liability insurance as well.