Have you ever wondered what would happen to your company if you lose a lawsuit and are charged more than your liability insurance limit? Well, you will have to pay that extra cost from your savings, a situation that could potentially cripple your company. This is why as a commercial Company, you require commercial umbrella insurance.
What is Commercial Umbrella Insurance?
Commercial Umbrella Insurance gives your company liability protection by paying any extra costs above the limit of your other liability insurance covers. For example, if you own a tree trimming service, you can purchase commercial umbrella insurance for tree service to cover damages that your ordinary insurance won’t cover. It is not a stand-alone insurance cover but rather works together with your other insurance covers to offset the additional costs after their limit has been reached.
What does it cover?
This insurance cover protects you from vehicular accidents, libel, product liability, reputational damage, and customer injury liability claims. Commercial Umbrella Insurance usually covers any extra costs of bodily harm that your company has caused employees or a customer. It also covers any damages caused by your company to someone else’s property above the limit of your other liability policy.
This insurance doesn’t usually cover costs on the destruction of your business, or its equipment.
For example, suppose you have a vehicle, and it gets into a road accident when working. In that case, Commercial Umbrella Insurance will only cover the costs of the damage by your car and any medical bills that are not taken care of by your other liability insurance covers.
However, car damage costs that are not covered by your liability insurance will have to come from your pocket. In case your employee had used their vehicle for your business errands, then it is involved in an accident. Then this insurance policy will cover for excess costs of damages to it.
Commercial Umbrella Insurance, just like any other insurance, has limits. This means that the policy will only cover the costs up to the limit of your cover. You should therefore take the cover that best suits the risks of your business.
You should also consider your standard liability insurance cover limit as this cover will only kick in after that limit has been reached.
Who needs it?
The Commercial Umbrella Insurance cover is a must-have for high-risk businesses. Any business that can exceed the limit of its liability insurance covers should consider this cover a necessity. Businesses such as construction companies, those with massive customer interaction, or those operating in another person’s property, can be considered high-risk.
If your business provides products that may cause harm to its users may leave you vulnerable to high-cost lawsuits. For a company whose workers are exposed to potential danger or injury, it is necessary to have this insurance.
The higher the risk of your business, the more it may cost you to get Commercial Umbrella Insurance. An insurance agency will require you to pay more to get this cover if you have a large fleet of cars in your business operation compared to one with few vehicles.
Conclusion
Commercial Umbrella Insurance is a must-have for any company or business at a high risk of exceeding liability insurance coverage limits. However, you need to have another liability cover to qualify for this policy. You should carry out research to identify the best Commercial Umbrella Insurance that best suits your business requirements.