Commercial Insurance 101

The success of any business depends on a vision, work ethic, and building a dream; commercial insurance makes sure that all the effort and money you have invested in your business is covered in case a natural or financial disaster strikes. Most businesses need to purchase at least the following four types of insurance:

Property Insurance covers you if the property you use in your business is lost or damaged by common perils such as fire or theft. Property insurance covers not just a building or structure, but also what insurers call business personal property, like furnishings.

Liability Insurance covers you in the event that someone claims your business caused them harm. Your liability insurance pays damages to third parties resulting from bodily injury or property damage for which your business is legally liable, up to the policy limits, as well as legal fees associated with the claim. It also covers any medical bills for any people injured by your business.

Commercial Vehicle Insurance provides coverage for autos owned by the business. This insurance pays any costs to third parties resulting from bodily injury or property damage for which your business or employees are found legally liable, up to the policy limits. Depending on what kind of coverage you buy, the insurance may pay to repair or replace your vehicle because of damage resulting from accidents, theft, flooding, and other events.

Workers Compensation Insurance or workers comp, as this coverage is commonly known, pays for medical care and replaces a portion of lost wages for an employee who is injured in the course of employment, regardless of who was at fault for the injury. It also helps protect the business from a lawsuit from the injured employee.

There is additional coverage to be considered in addition to the basics highlighted above, there are various other policies needed by some businesses, including the following:

Business Catastrophe Liability or Umbrella policies provide coverage over and above your other liability coverage limits. They are designed to protect against unusually high losses. For the typical business, the umbrella policy would provide protection over and above general liability and auto liability policies.

Professional Liability Insurance policies are designed to meet specific needs of individual businesses specialized for liability policies needed by some businesses. They include Errors and Omissions Insurance (E&O)/Professional Liability Insurance, Employment Practices Liability Insurance (EPLI) and Directors and Officers Liability Insurance (D&O).

Terrorism Insurance is offered to owners of commercial property as mandated by the Terrorism Risk Insurance Act, enacted by Congress in 2002. Insurance losses attributed to terrorist acts under these commercial policies are insured by private insurers and reinsured by the federal government.

Navigating the world of commercial insurance and determining your businesses’s needs can be tricky. Be sure that you engage a reliable insurance professional when the time comes to purchase or re-evaluate your commercial insurance policies.

You can click here to start the process of a quick, free, easy quote from one of our specialists at CommercialInsurance.net, or call us at 1-877-907-5267.

Umbrella Policies

A Commercial Umbrella policy, which is often called excess liability, may afford additional coverage above and beyond the smaller policies that you have in place for your business.

Usually, those smaller policies may include any combination of your Employer’s Liability, General Liability policy, and hired and non-owned Commercial Vehicle policies; umbrella policies can provide additional coverage for all of those.

If you have, for instance, a million dollars in coverage, you may add an umbrella policy in order to maximize the protection of your business assets, in case there’s a loss that exceeds that amount.

As a practical example, let’s suppose that a covered claim someone makes against you is awarded $1,500,000. Let’s also say that you have $1,000,000 in general liability coverage. In the case of an event like this, your umbrella policy would provide the additional $500,000 to settle the claim, saving your business a lot of money and stress.

A commercial liability umbrella policy is one way to increase coverage of several policies while at the same time keeping your overall premiums down.

When considering how much coverage your business needs, several factors come into play. You’ll need to take several things into consideration as you figure out the appropriate amount of excess liability coverage. Some of those factors include the kind of business you own, the assets of the business, and the coverages your business already has in place.

Generally speaking, standard coverages will take care of most situations that are likely to occur, although in extreme situations, it’s important to protect the assets and the general well-being of your business.

You should also remember that a commercial umbrella or excess liability policy will not protect either Errors and Omissions or other risks that would fall under the auspices of a Professional Liability Policy.

A discussion with your licensed insurance professional to develop an analysis of your current business coverage and decide whether a commercial umbrella policy is necessary for your individual situation could be the key to the salvation of your company in the event of a serious claim against your business.

Click here to start the process of a quick, free quote for a variety of business insurance policies–including commercial umbrella policies–or call to speak with one of our specialists at 1-877-907-5267.

What Is Commercial Umbrella Insurance?

What is Commercial Umbrella Insurance and does my business need to carry it?

Commercial umbrella insurance, sometimes called Excess Liability Insurance, supplements the limits of an insured’s underlying policies such as General Liability, Commercial Auto, and Employer’s Liability Insurance. An umbrella policy can also protect a business from gaps in existing coverage, possibly even exclusions written into the primary liability policy. In simple terms, an umbrella policy will pay out when other insurance policy limits have been reached.

For instance, your general liability insurance policy may have a million dollar limit. In the event of an award of 1.25 million dollars, to someone who has filed a claim against you, your general liability policy will pay out the million dollars, and then your commercial umbrella policy (as long as it is in an amount sufficient to make up the difference) will pay out the $250, 000 shortfall, protecting your business assets from lien or liquidation. It is important to remember that a commercial umbrella is used to add protection for general liability, employer liability, and commercial vehicle insurance; it is not a replacement for having policies in place for these things, in the appropriate amounts for your business costs and risks.

When a loss that is eligible for umbrella coverage is either not covered or only partially covered by underlying insurance (including incidents where no other insurance exists), the umbrella insurer has the right and duty to defend any suit against the insured. It is also permitted to investigate any loss and settle any claim or suit as it chooses. In case an insurer is prevented from defending an insured, the insurer will reimburse any defense costs and expenses. However, the expenses must be incurred with the insurer’s written consent.

A commercial umbrella policy can increase the potential coverage of several policies for a substantial dollar amount for a reasonable cost versus increasing the individual policies coverage to the same threshold. This can help a business owner control costs while maximizing protection. It’s important to discuss aspects of umbrella coverage versus raising your standard policy limits and what scenarios could potentially play out in the event a large claim is brought against your business.

Take the time to determine what types of claims are made in your industry and what awards are generally given in a lawsuit. If you belong to an industry association, check with them as well. In many cases, the initial protection will cover most scenarios.

However, your research may indicate a commercial umbrella policy will manage the higher end damage awards and protect the assets and financial solvency of the business in the event of large claim and award.

Your licensed insurance professional can guide you in developing a commercial umbrella policy and how it will work in protecting your business and it’s assets.

In the event that you need help finding out what your specific needs are, you can click here to start the process of getting a competitive, free quote for several types of business insurance–including commercial umbrella policies–or you can call 1-877-907-5267 to speak with one of our specialists.

Business Insuance Claims

Restaurants, travel industries, and several other types of businesses as a whole have suffered losses in revenue over the past couple of years.  However, they are now seeing results from a slow, but steady increase in business.  Like many other companies, however, they are seeking ways to cut expenses and often look at insurance costs as an unnecessary expense. In some cases they’re not only decreasing coverage but whole policies, and this can be a business-ending mistake.

 

Umbrella policies are one of the first to go along with additional coverage such as business income and extra expense.  No one really believes they will ever suffer from catastrophic loss or large claims.  Most of the time, business owners do not really know how specific coverages affect their business and do not maintain proper business insurance to value, therefore reducing their claim settlement to less than expected.  Care, custody and control is another part of the policy where settlement is not understood.  If you have questions about how your policy relates to a cause of loss, please talk with your agent or one of ours. It’s vital to understand what you need and whether you have it–don’t wait until there’s a claim against you to look into it. It might be too late at that point. It’s also important to remember that even unfounded claims often need to be settled, so even if you pride yourself on worksmanship, or professionalism, and don’t believe that a mistake or shoddy work could cost you your company…remember that risk includes things that are out of your control.

 

Commercial Insurance.Net, LLC Advisor is not an attorney, accountant or certified financial planner and makes no representations or warranties to that effect.  Always check with your chosen professional as to statements made in this blog for your particular situation. If you need a quick, comprehensive, competitive quote, click here, or call us at 1-877-907-5267 to speak with one of our specialists. Risk management is an art, and our business is helping you protect your business. Get in touch with us today to find out if you’re adequately protected, and rectify the situation if you aren’t.

 

Insurance Risk

Risk is the ultimate four letter word. (At least it is when you’re talking commercial insurance.)

Just because it isn’t banned on the airways or in print, and doesn’t qualify for parental ratings, when it comes to business, it is still, nevertheless, a very bad word.

The safeguard against the risks your business faces is commercial insurance. The policies you put in place are going to be your best bet at keeping your business going in the event of a claim against you.

Because lawsuits are on the rise.

Today, every business faces the reality of a major lawsuit. A lawsuit can devastate and close many businesses, sometimes even before a verdict is reached, just through legal costs alone, and–don’t forget–just because a lawsuit has no merit doesn’t mean it won’t make it to court and cost you money.

Commercial umbrella insurance can take risk back to being just a word. A commercial umbrella policy can extend the limits of the business policy you have in place in the event coverage limits and your insurance risk are reached. Once a policy reaches its dollar limit, a commercial umbrella policy will offer more coverage to protect the business.

Here’s an example of how a commercial umbrella policy would work to decrease your insurance risk overall; let’s say that an accident at your business location causes injury to several people. Medical and compensatory awards are 3 million dollars. Your general liability policy covers 1.5 million dollars per occurrence leaving an unfunded liability to the company of 1.5 million dollars. Let’s pretend that an umbrella policy of 2.5 million dollars is in place and covers the additional 1.5 million dollars. This allows the business to be protected and not forced to extreme measures to settle the additional 1.5 million dollar obligation.

Now is the time to determine the risk exposure to your business, not when it is too late. In the above example, even though the general liability policy limit was 5 million dollars in the term of the policy, the 1.5 million dollars per occurrence left an additional risk.

Commercial umbrella policies can sometimes be purchased very inexpensively for a number of risks, and in some cases, the premium is less than extending the limits of your standard policies. Work with your licensed insurance professional to determine if a commercial umbrella policy is another step in reducing your insurance risk so that it’s just another word.

Click here to start the process of getting a quick, free quote from one of our specialists, or call us at 1-877-907-5267.

Commercial Umbrella Insurance

Commercial umbrella insurance …is it right for your business?

A commercial umbrella policy, sometimes known as excess liability insurance, can supplement other policies in force.

Most liability policies have a limit to which they will pay out. For instance, your general liability insurance policy may have a million dollar limit. In the event of an award of 1.25 million dollars, your general liability policy will pay out the million dollars, and then your commercial umbrella policy — which, let’s say in this case is an additional million dollars — will pay out the $250, 000 shortfall less the self insured retention (deductible).

With a commercial umbrella policy in place in the above situation or one like it, you protect your business assets from lien or liquidation. It is important to remember, a commercial umbrella is used to add protection for general liability, employer liability, and commercial auto insurance.

A commercial umbrella policy can increase the potential coverage of several policies for a substantial dollar amount for a reasonable cost versus increasing the individual policies coverage to the same threshold. This can help a business owner control costs while maximizing protection.

It is important to determine the risk exposure and additional coverage needed if necessary. Work with your licensed insurance professional for help and guidance in determining whether a commercial umbrella may be a good option.

Take the time to determine what types of claims are made in your industry and what awards are generally given in a lawsuit. If you belong to an industry association, check with them as well.

In many cases, the initial protection will cover most scenarios. However, your research may indicate a commercial umbrella policy will manage the higher end damage awards and protect the assets and financial solvency of the business in the event of large claim and award.

Not sure where you stand with your coverage? Click here to start the process of getting a quick, comprehensive, free quote for a variety of types of business insurance–including commercial umbrella insurance–or call us today at 1-877-907-5267 to speak with one of our specialists.

Don’t get all wet in the event a lawsuit catches you without sufficient coverage…ask us about commercial umbrella insurance today.