Though you have purchased a variety of insurance policies for your New York business, sometimes it is just not enough. Severe accidents, large lawsuits, and other claims can quickly exceed your policy limits, leaving your company on the hook for the remainder of the costs. Even with insurance, your company could go bankrupt. Commercial umbrella insurance extends your insurance limits for additional financial protection.
Commercial umbrella insurance is designed to pick up where your primary business insurance policies leave off. If you ever face a situation where your insurance coverage is exhausted, your umbrella policy can help pay the remaining expenses, up to your umbrella policy limits. Umbrella insurance can cover a wide scope, including property damage to a third party, general liability, personal injury, and auto liability. Though no New York business ever wants to be in this situation, umbrella insurance can be invaluable when your other insurance runs out.
In order to purchase an umbrella policy, you must first have primary insurance coverage for all of your risk exposures, including general liability, workers compensation, commercial auto, and any other policies your umbrella carrier may require. These primary polices must be properly maintained in compliance with your umbrella policy.
Most umbrella carriers will also require that your policy limits are $1 million or more. It is only once you hit your primary policy limits that your umbrella policy will begin to pay. Often it is advised that your deductible on your umbrella policy match your coverage limits on your primary policy, to minimize your out of pocket expenses.
Once you have commercial umbrella protection, you can expect extended coverage for the situations covered by your primary insurance, unless there is a specific exclusion in your umbrella coverage. This can include coverage for:
You should speak with your insurance agent to understand all of the coverage an umbrella policy may offer you and your company.
Like all policies, umbrella policies will exclude some situations. You should understand what is and is not covered prior to purchasing your umbrella policy. Some items that may be excluding are:
Your policy may also require that you pay the costs out of pocket and then file for a reimbursement. It is important that you understand if your policy works this way before you are faced with the situation. Your insurance agent can help explain all the details of your policy and guide you to a different umbrella policy that better suits your company’s needs if you wish.
Commercial umbrella insurance can provide important liability protection to New York businesses. When you exhaust the limits of your primary insurance policies, you may be required to pay out of pocket for any remaining expenses, which may jeopardize your business. A commercial umbrella policy can help extend your coverage, potentially limiting your out of pocket costs.