If you own a business, you should carry general liability insurance to protect you in the event of a lawsuit due to negligence on your part. However, there may be situations where the limits of your business insurance policy, commercial auto policy, and worker’s compensation policy don’t provide adequate protection. 

In cases like that, business umbrella insurance, also known as Business Catastrophe Liability insurance, becomes a valuable asset that provides you and your business additional liability protection. At Peterson Insurance, our team of experienced agents can help you find an affordable business umbrella insurance policy with the coverage you need to safeguard your assets.

What is Umbrella Insurance for Business?

So, what is umbrella insurance for business, exactly? It’s an additional layer of liability protection that companies can use to guard themselves against financial losses. 

It provides additional liability coverage limits on your underlying business policies (such as property policies, liability, auto, and worker’s comp policies) in case of a large lawsuit or claim. 

A business umbrella insurance policy helps businesses of all sizes protect their assets and finances should a major lawsuit arise without bearing the full brunt of such costs from their own pocket. Umbrella insurance for businesses can provide peace of mind to those running a company, as it helps them keep their financial security intact in the event of unforeseen circumstances.

Who Needs Business Umbrella Insurance?

Business umbrella insurance is essential for companies of all sizes, but it’s particularly crucial for those exposed to higher levels of risk. Businesses that frequently interact with the public, such as retail stores, restaurants, and service providers, should strongly consider this coverage. These industries often face higher chances of customer accidents, which can lead to costly liability claims.

Businesses with significant assets or those operating in litigious environments are prime candidates for umbrella insurance. If your company could face a lawsuit that exceeds your general liability coverage, business umbrella insurance becomes invaluable. 

Companies that regularly work with hazardous materials, operate heavy machinery, or have substantial client contracts should also carry umbrella insurance. Even small businesses can benefit, as a single major lawsuit could otherwise jeopardize their financial stability.

What Does Business Umbrella Insurance Cover?

A business umbrella insurance policy covers similar types of costs as liability business insurance. 

This includes: 

• Personal injury and libel offences
• Attorney fees
• Medical expenses
• Damages if your current business policies don’t cover these types of incidents fully. 
• It can also cover damage to property not protected under your business property insurance policy.

How Much Umbrella Insurance Should a Business Carry?

It's essential to ensure you're adequately protected from unforeseen losses or accidents. However, businesses come in all shapes and sizes, so the amount of umbrella insurance a company should carry does vary. 

A good starting point is to match your business umbrella insurance policy to your net worth. If your net worth is $2 million, your insurance policy should cover that much. Ultimately, having proper umbrella insurance will help you keep your business safe and secure no matter what comes your way.

Umbrella policy insurance for businesses offers coverage of $1 million—$10 million (with $1 million increment options). 

How Do You Assess How Much Coverage You Need?

Determining the appropriate amount of umbrella liability insurance requires carefully assessing your company’s financial situation and potential risk exposure. 

• Begin by evaluating the value of your business assets, including property, equipment, and intellectual property. 
• Consider the size of your company, your industry, and the likelihood of facing significant lawsuits. For example, a business in a high-risk industry like construction may need more coverage than a small retail shop.

A general guideline is to match your umbrella insurance coverage to your net worth or the total value of your assets. This ensures that your assets remain protected even if a large claim exceeds your primary insurance policy limits. 

Additionally, consult with an insurance agent who understands your industry and can provide tailored advice. They can help you analyze your existing policies and recommend a coverage amount that safeguards your business without unnecessary over-insurance.

Does Umbrella Business Insurance Cover All My Risks?

While business umbrella insurance provides extensive protection, it doesn’t cover every possible risk your business might face. Umbrella insurance extends the liability coverage limits of your existing policies, such as general liability, commercial auto, and workers’ compensation insurance. 

However, it doesn’t replace those underlying policies or cover gaps your primary insurance doesn’t address.

For instance, business umbrella insurance typically does not cover risks associated with professional liability (errors and omissions), employment practices liability, or cyber liability. These risks require separate insurance policies. 

It’s important to conduct a thorough risk assessment and discuss it with your insurance agent to ensure you have comprehensive coverage. This may involve supplementing your umbrella insurance with additional policies tailored to your business's specific risks.

What Is Excess Liability Insurance?

Excess liability insurance is often confused with umbrella insurance, but it serves slightly different purposes. 

Excess liability insurance increases the limits of an existing insurance policy, offering additional coverage beyond what the original policy provides. It’s typically attached to a single underlying policy, such as general liability or commercial auto insurance.

Unlike umbrella insurance, which can extend the coverage of multiple policies, excess liability insurance only boosts the limits of one specific policy. This makes it a good option for businesses that need higher coverage for a particular risk area. 

For example, a company may purchase excess liability insurance to increase its general liability coverage due to the nature of its business operations.

Find Umbrella Insurance for Business from an Independent Agency in PA

Are you looking for a reliable business umbrella insurance policy in Pennsylvania? If so, you’ve come to the right place. At Peterson Insurance, we are proud to be your go-to independent agency for business umbrella insurance coverage in PA. 

With 25+ years of experience, we have earned a reputation as a trustworthy and knowledgeable provider. We provide our clients with top-notch service and competitive rates. As an independent insurance agency, we aren’t tied to a particular provider and can find you the best policy among 30+ A-rated companies.

Call Peterson Insurance for Your FREE Business Umbrella Insurance Quote Today!

As an independent insurance agency located in Havertown, PA, we can help you secure a business umbrella insurance policy that provides ample coverage beyond your general liability policy, commercial auto policy, and worker’s compensation policy. 

Click to get a free business umbrella insurance quote online, or call to speak directly with one of our local insurance agents to find affordable business umbrella insurance in Pennsylvania today!