Commercial Umbrella Insurance Policies: Extra Coverage, Extra Protection 

Imagine you’re a business owner, and you have a general liability policy with a $1 million limit. Your company is sued, and the lawsuit results in a $2 million judgment. Without commercial umbrella insurance, your company is on the hook for the other $1 million that isn’t covered by your general liability policy.  

Commercial umbrella insurance policies would cover that other $1 million, preventing you from paying out of pocket. Commercial umbrella policies provide extra coverage, which offers you extra protection from unexpected out of pocket costs.  

What is Commercial Umbrella Insurance? 

Commercial umbrella insurance is a policy that provides extra coverage beyond the limits of a business’s primary liability policies.  

Certain policies only provide coverage up to a certain dollar amount. Some of these policies include:  

  • General liability insurance 

  • Commercial auto liability insurance 

  • Employer’s liability insurance 

Commercial umbrella insurance policies tend to have a higher coverage limit than a typical liability policy, often in increments of $1 million. This type of insurance also offers broad protection, often covering gaps in your underlying policies. In addition, commercial umbrella insurance also helps cover attorney fees associated with a claim.  

What is NOT covered by Commercial Umbrella Insurance? 

While commercial umbrella insurance provides broad coverage in a variety of areas, there are a few things it does not cover. This type of insurance does not cover: 

  • Business property damage 

  • Intentional acts or criminal behavior 

  • Professional liability (errors & omissions) — unless specifically added 

Your Business’s Safety Net 

Commercial umbrella insurance acts as your business’s safety net. The main goal of this coverage is to protect your business from large liability claims or lawsuits that exceed the limits of your existing policies.  

You might be wondering, will you ever need this type of coverage? Here are some examples of times when this coverage could be invaluable to your business: 

  • You're in an industry with high risk of lawsuits (e.g., construction, manufacturing) 

  • Your company has significant customer or public interaction 

  • You have a high net-worth business, and you want to protect assets 

If you have questions about how commercial umbrella insurance can provide extra coverage for your business, don’t hesitate to contact First State Insurance. We’re happy to help you explore options to keep yourself and your business protected.