Commercial umbrella insurance for auto services and dealers

Lawsuits can be costly for any automotive business – even to the point where your insurance policy can’t cover everything. Commercial umbrella insurance, similar to excess liability insurance, can make up the difference when a claim exceeds the limit of your underlying policy.

This policy supplements the coverage offered by:

• General liability insurance
• Commercial auto insurance or hired and non-owned auto insurance
• Employer’s liability insurance (part of workers' compensation insurance)

Small automotive businesses often invest in this policy to fulfill the terms of contracts with high policy limits, or to reduce the impact of an expensive lawsuit.

Consider carrying umbrella insurance if you:

• Need higher policy limits to meet a client's demands
• Need increased protection across several liability policies
• Interact with the public on a regular basis
• Have risks that merit higher coverage limits

When it comes to umbrella insurance, purchasing coverage from the same insurance provider who sold you the other policies is typically easier and more affordable.

When your business carries umbrella insurance, it increases the protection limits of your existing liability policies. For instance, you might have a general liability insurance policy with a $2 million per-occurrence limit. This means it can cover up to $2 million in legal expenses, judgments, and settlements on a single claim.

Now, say a shelf falls onto a client visiting your gas station, who sues for the injuries. Between attorney’s fees and the court-ordered judgment, you owe $2.2 million. Umbrella insurance can pay for expenses that go over a policy’s limit, in this case paying for the extra $200,000.

Commercial umbrella insurance boosts the coverage on your underlying insurance policies, primarily general liability, commercial auto, and employer's liability insurance.

Umbrella / excess liability insurance becomes active when your general liability insurance maxes out its policy limit. It can help with any general liability claim, including:

• Customer slip-and-fall injuries
• Customer property damage
• Advertising injuries, such as slander and libel

Umbrella insurance also covers claims on the general liability insurance portion of a business owner’s policy (BOP).

If a liability claim on your commercial auto insurance exceeds the policy limit, an umbrella insurance policy will pay the additional amount. It also extends coverage on hired and non-owned auto insurance (HNOA) for automotive experts who use a personal, rented, or leased vehicle for business purposes.

In an accident, it could help pay for lawsuits resulting from:

• Injuries you caused to others
• Damage to another person’s vehicle
• Damage to another person's property

If an employee is injured and files a lawsuit against the employer, employer’s liability insurance helps pay for legal expenses. Umbrella insurance expands that coverage.

For example, if an employee at your repair shop claims that your failure to provide proper lifting equipment led to a back injury, you could be held liable. When the legal costs exceed the employer’s liability portion of your workers’ compensation policy, your umbrella insurance policy would pay for the amount over the limit.

• Property insurance claims
• Expenses covered by an underlying policy
• Employee discrimination lawsuits

Similar to umbrella insurance, excess liability insurance can increase the limits of your professional liability insurance or errors and omissions insurance (E&O).

Umbrella insurance boosts the limits on other policies, but does not provide protection by itself. Automotive business owners should also consider:

Business owner’s policy: A BOP combines general liability coverage and commercial property insurance, usually at a lower rate than if the policies were purchased separately.

Cyber liability insurance: This policy helps automotive businesses recover from cyberattacks and data breaches. It's recommended for any business that stores credit card numbers or other personal information.

Garage liability insurance: This policy extends general liability coverage to the heightened risks of working in a garage. It's designed for auto shops, parking garages, and other businesses that sell, store, and service vehicles.

Garage keepers insurance: This policy provides coverage in the event that a customer’s vehicle is damaged or stolen while in your care. It's recommended for any auto business that services or stores vehicles.

Are you ready to boost your coverage against lawsuits with commercial umbrella insurance? Complete Insureon’s easy online application today. Once you find the right policy, you can begin coverage in less than 24 hours.