There are a variety of ways a business can benefit from the additional coverage umbrella insurance provides. If you’re thinking about obtaining a commercial umbrella insurance policy for your business, here are 4 things your company needs to have in place first.
1. Underlying Insurance
Unless you already have a primary policy that offers liability coverage, you will not be able to obtain commercial umbrella insurance in San Diego. Depending on the insurer, you may first have to obtain workers’ compensation, employment practices liability, and general liability insurance.
2. Negotiation Skills
San Diego commercial insurance providers can be highly subjective when offering umbrella policies, and some even shy away from offering this type of insurance at all. What this means for you as a business owner is that provisions may be negotiable if you can influence the judgment of the underwriter.
3. Defense Against Claims
Though attorneys from your primary insurance company will likely rush to defend you against liability claims filed against your business, you should not assume this will also happen with umbrella insurance. As a general rule, insurance companies that provide umbrella coverage make exclusions to their duty to defend. However, they may also reserve the right to defend. In other words, if the umbrella insurer sees an opportunity to apply a legal strategy in its best interest, it will likely do so and assist the primary insurance provider. If the provider is the same for both policies, defense will obviously be in the insurer’s best interest.
4. Self-Insured Retention (SIR)
The California Department of Insurance reminds business owners they may be subject to SIR deductibles of $10,000 if their umbrella policies kick in when the underlying policy is not in effect. This is important to remember in case your business has gaps in coverage.
You may think of the term “umbrella policy” as being all-encompassing, but there are certain industry-wide exclusions you should be aware of. Two common examples include contamination and aircraft operations, but you should check with your insurance company for the rest of the exclusions.
Make sure your company has the coverage it needs by reaching our to American Tri-Star Insurance. In addition to commercial insurance, we also offer reliable home, health, bond, and auto insurance San Diego residents trust. Call 619-272-2100 today to speak with one of our knowledgeable agents and receive a free quote.