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Excess(Umbrella) Liability Insurance is designed to give you an extra layer of security. It provides supplementary coverage for costs associated with lawsuits, legal fees and settlements.

Additionally, business umbrella liability insurance can cover bodily injury and personal property claims that are not covered by your other liability policies (such as property, auto and workers compensation).

Example of Use

Let's assume that your business was named in a liability claim that required $4 million to settle, and the limit of your general liability policy is $2 million. Here's what would happen:

• Your insurance company would pay $2 million
• Your business would be responsible for the other $2 million

A $5 million business umbrella liability insurance policy would have covered the rest of the settlement (the remaining $2 million) and left your business with $3 million in extra liability protection.

• Exclusions

Most business umbrella liability insurance policies exclude employment practices liability, professional liability, product recall coverage, workers' compensation insurance and coverage for asbestos-related claims, pollution, war and terrorism.

• Insurance coverage limits

Business umbrella liability insurance policy limits are typically within a range of $1 million to $5 million and are appropriate for business owners who have significant assets or may be especially susceptible to lawsuits.

• Two kinds of insurance coverage

  • The amount that exceeds the maximum coverage limits from your primary business
   liability or business auto policies

• Additional coverages not provided by your primary business liability or business auto

• Business umbrella liability insurance and your home business

Business umbrella liability insurance only provides extra coverage over what the original base policy covers. If your home business is not covered in the general liability or homeowners policy, the umbrella won't cover it either. However, if you have designed your business insurance program to protect your home business, then business umbrella liability insurance will offer the added protection you just might need.

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