Is Your Business Prepared for a Rainy Day?
Your business insurance plan most likely consists of the following: Insurance on your building, business personal property, commercial auto insurance, general liability, workers compensation, and professional liability. Those are the nuts and blots of a well-rounded business insurance package and I’ll get into the details of each in another article on another day. What I want to talk about is something that every business should consider… an Umbrella Policy. Because when it rains it pours!
An Umbrella Policy will provide your business with coverage above and beyond the basic coverage limits shown on your underlying policies. It is a fantastic option not only because of the additional coverage that it provides, but also because it does so at such an affordable cost.
How Does it Work?
Let’s pretend that you have a commercial auto insurance policy that covers bodily injuries caused to others up to $100,000 per person. Now let’s say that you have a driver who causes a severe accident and one person sustains injuries in the total amount of $300,000. That means that your business will be liable for the additional $200,000 and it could very well be what puts you out of business and into financial ruin.
Now take that same situation, with that same commercial auto coverage but let’s say you have an Umbrella Policy in the amount of $1,000,000. Instead of having to bear the burden of that additional $200,000 your Umbrella Policy kicks in after that first $100,000 has been exhausted from your underlying auto policy. Your business has been saved.
That is only one example. An Umbrella Policy can be applied to any type of liability coverage you carry in your insurance plan. You could use it if someone is injured at your place of business or you could use it to help recoup damages from a defamation claim. Again… just examples.
It is an extension of your liability and can usually be purchased for just a few hundred dollars per year. The extra premium is peanuts compared to what it can do for you if you need it!
