What is Commercial Umbrella Insurance?
Even with generous primary insurance coverages in place, businesses in New Jersey sometimes still remain exposed to possible risks. Commercial umbrella insurance, or business umbrella insurance, gives businesses a way to enhance the protections provided by their primary policies.Business umbrella insurance is a supplemental, or secondary, insurance that enhances the coverages and limits of primary, or underlying, policies. A general liability policy, commercial property policy, commercial auto policy or other kind of commercial insurance policy may function as a primary policy. Often, a single business umbrella policy will supplement several underlying policies simultaneously.
Being a secondary form of insurance, a business umbrella policy typically won’t provide coverage until the limits of any primary coverage have been exhausted. Most business umbrella policies have requirements about what underlying coverages must be maintained. Not following a policy’s requirements for underlying coverages could compromise, or even void, the policy’s umbrella coverage.