Finding Commercial Insurance

All commercial business policies, including property, casualty and commercial liability insurance policies, have upper limits on payouts beyond which they will not pay for damage or loss.  Commercial umbrella insurance provides additional coverage for claims that exceed the upper limits of these policies.  In other words, they provide coverage over and above your other coverages. Umbrella Policies are formulated to protect a business against extraordinarily  high losses, when the upper policy limits of one of the basic  policies have been exhausted. For the average business, an Umbrella Policy would supply insurance protection over and above basic liability and auto liability coverage. If you happen to have have Employment Practices Liability Insurance, Directors and Officers Liability or other kinds of liability insurance, the Umbrella Policy would give you additional protection over and above those upper policy limits as well.

The are many different types of Umbrella Policies available from a host of commercial insurance companies.  Some offer blanket coverage for several underlying policies or packages, while others are more specific to certain commercial insurance coverages.  In order to accurately determine what kinds of commercial umbrella policy coverage you actually need, you and your agent need to do a serious and thorough risk assessment of your business, its nature, its inherent risks in day to day operations, and then thoughtfully consider the likelihood of truly disastrous claims that would exhaust the underlying policies’ upper limits of payouts.  These vary widely and differ according to the type of business in which you are engaged.

Fortunately, most Umbrella Policies are reasonably priced because the likelihood, or risk, of exhausting of the upper limits of underlying policies is usually quite low.  Even so, most business people sleep better at night knowing that if the worst indeed happened, they have more than adequate coverage with the benefits available through their Umbrella Policies.

The amount of Umbrella Policy coverage you obtain is determined by you, and while cheap commercial insurance is certainly available, this is an area where you get what you pay for.  Usually umbrella coverage is available in increments of $1 million, $3 million and $5 million and the premiums are typically only a few hundred dollars per million dollars of coverage.  The sensible thing to do with Umbrella Policies is to buy as much as you can afford because of the litigious habits of the suit-happy public.  Juries can make awards of $20 million or more and your insurance coverage could be quickly exhausted, leaving you to foot the bill for the remaining balance on the award.  Also buying your Umbrella Policy from the same insurance company that you obtain the underlying coverage from makes good sense as well, for it prevents quarrels and delaying tactics as one insurance company vies against another trying to force the other to pick up the costs of a claim.

As the saying goes, “When it rains, it pours.”  It’s best to be prepared for truly horrendous  disasters with a big, strong Umbrella Policy!