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Small business owners often wonder if they need commercial umbrella insurance. This type of insurance provides additional liability coverage beyond what is offered by standard commercial insurance policies. In this article, we will explore when small businesses need commercial umbrella insurance, how it works, what it covers, and how much it costs.
Commercial umbrella insurance is designed to provide additional liability coverage above and beyond what is offered by a standard commercial insurance policy. It kicks in when the limits of your primary policy have been exhausted. For example, if you are sued for a large amount of money, and the judgment exceeds the limits of your primary policy, commercial umbrella insurance will provide additional coverage to cover the excess amount.
Commercial umbrella insurance provides additional coverage for a variety of liability exposures that are not typically covered by a standard commercial insurance policy. Some of the common liability exposures that commercial umbrella insurance covers include:
The cost of commercial umbrella insurance varies depending on several factors, including the amount of coverage you need, the industry you operate in, and the level of risk associated with your business. As a general rule, the cost of commercial umbrella insurance is relatively low compared to the amount of additional coverage it provides.
To get a better idea of how much commercial umbrella insurance will cost for your business, you should speak with an insurance agent. They can help you assess your liability risks and determine how much coverage you need. They can also provide you with a quote for commercial umbrella insurance that is tailored to your specific business needs.
Small businesses may need commercial umbrella insurance when their primary insurance policies, such as general liability or commercial auto insurance, do not provide enough coverage to protect against large losses.
Here are some situations when a small business may need commercial umbrella insurance:
High-risk business activities: If your small business is involved in high-risk activities, such as construction or manufacturing, you may need extra liability protection in case of an accident or injury.
Large-scale events: If your business is planning a large-scale event, such as a trade show or concert, you may need umbrella insurance to protect against potential lawsuits or other liability claims.
Expensive equipment: If your business owns expensive equipment, such as heavy machinery or specialized tools, you may need extra coverage in case of damage or theft.
Property ownership: If your business owns the property, such as a commercial building or rental property, you may need umbrella insurance to protect against liability claims from tenants or visitors.
High-net-worth clients: If your small business serves high-net-worth clients, such as wealthy individuals or corporations, you may need extra liability protection to cover potential claims that exceed the limits of your primary insurance policies.
It's important to speak with expert insurance professionals like the ones at Club Agency to determine if your small business needs commercial umbrella insurance and what level of coverage is appropriate for your specific business needs. Contact us today to get started!
