Every company is different, with its own set of unique needs. However, the need to reduce liability and manage risk is fairly universal. Many businesses turn to umbrella coverage to accomplish that. These questions can help you determine if business umbrella coverage is right for your business.
1. Do You Operate in a High-Risk Industry?
Some industries carry higher risks than others. Take construction, for example. Heavy machinery, unsecured job sites, and a plethora of tools increase the risks of an injury happening. That adds to your company’s liability. An umbrella policy could help cover claims made against your business after an accident.
2. Do You Work With the Public?
Anytime people are involved, business risks increase. In what many argue is an increasingly litigious society, even a minor accident could lead to a potentially catastrophic lawsuit. Settlements and awards can easily run into the millions of dollars. Chances are, your primary business liability policy won’t offer enough coverage for those amounts.
3. Could You Cover Costs if Your Insurance Doesn’t?
That leads you to the next question. If your insurance pays only a portion of a settlement, can your business absorb the remaining amount? It not, an umbrella policy is a good idea. It kicks in after your primary liability insurance and covers additional amounts. Most policies also provide broader coverage, which can further decrease company liability.
Speaking with an experienced and knowledgeable insurance agent is the best way to determine if umbrella coverage can help meet your business’ risk management needs.