If you’re a small business owner, you may already have some type of general liability insurance coverage and auto liability insurance coverage. However, there may be instances where the limits of your general liability policy may not provide you with enough protection. For instance, the limits of your general liability insurance policy may not be able to cover a large judgment against you or your business. You’ve likely put a lot of hard work and hours into growing your business, commercial umbrella insurance provides you and your business with additional liability coverage and protection.
In just about every business, mistakes, errors, and accidents occur — even with the best intentions. A commercial umbrella policy provides you with coverage in excess of the liability limits of your general insurance policy, and in certain cases broadens your general policy. It’s extra protection in the event of a catastrophic or unforeseen event that results in loss of thousands or possibly millions of dollars lost. Commercial umbrella insurance kicks in when a claim made against you exceeds the limits of your existing liability coverage.
The purpose of commercial umbrella insurance is not only to provide protection over and above your general liability limits, but also fill in the gaps of missing coverage in your primary policy. It’s especially important if your business consists of a number of valuable assets, or is worth a great deal of money. If you also have certain specialized insurance policies commercial umbrella insurance can give you additional coverage over these upper limits as well.
Commercial umbrella policies vary in what they cover, but they typically cover bodily injury, personal injury, property damage, extension of coverage of business partners and employees, contractual liability for both written and oral agreements, and more. In order to obtain the best coverage, your insurance agent would examine the nature of your business and conduct a thorough risk assessment of the inherent risks in your businesses day-to-day operations.
The rising cost of lawsuits is a reality that the small business owner must consider. The time, effort, and money you put into developing your business is too important to vanish because of just one unforeseen event. Commercial umbrella insurance is an indispensable part of your business insurance portfolio and is an effective risk management tool.
