Commercial umbrella insurance gives you extra coverage to help pay for costs that exceed certain liability policy limits. Without commercial insurance coverage, you’d have to pay out-of-pocket liability claims that cost more than your coverage limits.

This can include:

• Legal costs
• Medical bills
• Damage to other people’s property
• Judgments and settlements

A commercial umbrella policy extends the limits of some of your primary liability insurance policies, such as general liability insurance and commercial auto insurance.

For example, suppose your company is liable for a customer’s injury at your business, and you are sued for $1.5 million but only have $1 million in liability coverage. In that case, a commercial umbrella policy could compensate for the $500,000 shortfall, subject to the policy’s coverage limits.

• General liability insurance
• Employer’s liability insurance(often included in workers’ compensation)
• Hired and non-owned auto insurance

Before purchasing umbrella liability insurance for any of these policies, an insurer will require you to carry at least $1 million in coverage on the underlying policy.

Umbrella liability insurance cannot be added to professional liability insurance that covers lawsuits over professional mistakes, including undelivered services and missed deadlines.