CoverageUmbrella
Commercial umbrella insurance
A commercial umbrella policy adds liability limits above your general liability, commercial auto and employer's liability policies. Contractors usually buy it when a contract requires higher limits than the underlying policies provide.
What it coversCoverage
- Limits above general liability. Responds when a covered general liability claim exceeds that policy's limit.
- Limits above commercial auto. Responds when a covered auto liability claim exceeds the auto limit.
- Limits above employer's liability. Responds above the employer's liability part of workers' compensation.
- Exhausted aggregates. Can drop down when an underlying aggregate limit has been used up, depending on the policy.
What it usually does not coverExclusions
- Anything the underlying policies exclude. An umbrella generally follows the terms of the policies beneath it.
- Property damage to your own property. Umbrellas cover liability to others, not your own property.
- Replacing underlying coverage. The underlying policies have to stay in force at the required limits.
What contracts ask forRequirements
- Specified umbrella limit. Larger projects and commercial clients often require $1,000,000 to $5,000,000 or more in umbrella coverage.
- Follow form. Some contracts require the umbrella to follow the terms of the underlying policies.
- Additional insured. Contracts may require additional insured status to carry through to the umbrella.
QuestionsFAQ
What is the difference between umbrella and excess liability?
Both add limits above underlying policies. An umbrella can sometimes broaden coverage; an excess policy generally follows the underlying policy exactly.
How much umbrella coverage do I need?
Usually the amount your largest contract requires, plus a margin for your own exposure.
Do I need specific underlying limits?
Yes. Umbrella insurers require the underlying general liability, auto and employer's liability policies to carry set minimum limits.
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