What Is a Business Umbrella Policy?

 

What Is a Business Umbrella Policy?

 

What Is a Business Umbrella Policy?

 

Here are the main features of a business umbrella policy:

  • A business umbrella gives you an extra layer of liability coverage.
  • It helps cover losses that exceed the liability limits on your underling policies. 
  • It can be an affordable option for many businesses. 
  • You can select $1 million to $10 million in coverage.


Q: I’ve had business insurance for years now, but I’m always wondering if I have enough. I put my life savings into my business, so I want to protect it any way I can. What does a business umbrella offer that my other policies don’t?


Art Rusak, a Farmers Insurance® agent in Chicago, Illinois, gives his take on business umbrella policies.

A: As you probably know, liability means your company’s legal responsibility for injury to others or damage to their property. Sources of liability include auto accidents, product defects and errors made by the company. You can select coverage for different risks and the limit for each one.  

An umbrella policy gives your business an extra layer of liability coverage — in addition to the coverage provided by your underlying policies. Let’s say it’s snowing outside, and an employee causes a highway pileup while making a delivery. The limit on your auto policy isn’t enough to cover all the damage. Your umbrella policy will cover the remaining liability, up to your policy limit. Farmers® offers $1 million to $10 in coverage, available in $1 million increments. 

That’s a lot of coverage, but it doesn’t cost as much as you might think. In fact, many of the customers I work with choose umbrella coverage precisely because it’s very affordable. It can also help keep a single event from jeopardizing their entire business. 

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