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Umbrella coverage is a type of liability insurance that protects your business against an unforeseeable event—such as a lawsuit—that exceeds your primary insurance limits. It is ideal for those whose business carries significant risk, as well as those who want to increase their coverage security. If you have questions about an umbrella policy, below are answers to some of the most common.

A Guide to Umbrella Insurance

What does it cover?

An umbrella policy protects your business from claims for which you are liable. For example, this can include bodily injury or property damage on a construction site that you are running. Depending on the type of policy you have, it might also cover slander, defamation, and libel. In some cases, it can even include legal fees.

How does it work?

liability insuranceUmbrella insurance triggers when you exceed the limits on your other liability policies. For example, when someone makes a claim against you, and your liability insurance company reaches a settlement, this may not fully cover the damage. When this happens, you must pay for the difference out of pocket if you do not have an umbrella policy.

Why is this significant?

This type of policy protects your business against undue financial strain. In cases where a customer experiences a significant injury on your premises, their claims might target your business’ assets. For example, if a customer slips on your property, they might file a lawsuit against you to cover expensive hospital bills. With liability insurance, you’ll have an extra line of defense against this possibility.

How much coverage do I need?

When deciding on coverage amounts, you should consider all of your risks. If you have a particularly risky business—such as a construction or trucking company—you will likely need more coverage. Also, consider the total value of your assets, including savings, properties, and stocks.

The higher the value of your business, the higher your limit should be. Even if you’re a new business that doesn’t have many assets, consider the effect that a liability lawsuit might have on the future of your business, and increase your limits accordingly.

 

When you want liability insurance to protect your company, contact Kirk Insurance Agency in Spearman, TX. For over 20 years, this family-owned and -operated business has been providing coverage to individuals and businesses throughout the Texas Panhandle. Whether you need home insurance, auto insurance, life insurance, or coverage for your small business, they will help you find customized solutions. Speak to one of their knowledgeable agents today by calling (806) 659-2794. Visit them online for more information about their services.

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