Cheapest Umbrella Insurance Policy

Business insurance is a necessary investment for any company because it can protect against unexpected events that could lead to significant financial losses. However, you should note that there are limits to the coverage provided by business insurance policies. That's where umbrella insurance comes in.

Read this article to learn more about these policies so you can find the best and cheapest umbrella insurance policy to best protect your business.

What is an Umbrella Insurance Policy?

An umbrella insurance policy extends beyond the coverage provided by existing policies, offering additional protection for personal liability situations, property damage, injuries, and certain legal disputes. This type of policy can also cover claims that may not be included in other liability policies, such as libel and slander. Obtaining an umbrella insurance policy ensures that individuals can rest assured knowing they have comprehensive protection, regardless of what the future may hold.

For example, let’s imagine you own a store. One day, a customer slips and falls in your store, resulting in injuries that require extensive medical treatment. The customer files a lawsuit against your business, claiming $2 million in damages.

In this example, your general liability policy would cover the first $1 million of the claim, but you would be responsible for the remaining $1 million. However, if you have a business umbrella insurance policy with a limit of $2 million, it would kick in and cover the remaining amount.

Who Needs an Umbrella Insurance Policy?

If guarding your assets and savings beyond the highest liability coverage available from your business insurance is a concern, then an umbrella insurance policy can provide added protection up to $5 million or more, depending on the insurance provider. Failing to secure an umbrella insurance policy can leave your company's assets vulnerable, with only the coverage from your current policy offering any protection. In the event of a costly accident, the absence of umbrella insurance could result in significant financial loss, jeopardizing your hard-earned assets. With umbrella insurance, you can rest easy knowing that you have an additional layer of protection for your business, protecting it against any unforeseen circumstances that could impact its financial stability.

Reasons to Have an Umbrella Insurance Policy

It can save you money

Although the cost of insurance can be frustrating for business owners, investing in an umbrella policy may provide significant savings in the future. With sufficient coverage, you can confidently navigate unexpected situations such as lawsuits or on-the-job injuries without worrying about the associated expenses or resorting to drastic measures such as taking out loans.

Many insurance providers offer competitive rates for umbrella policies, allowing businesses to secure the necessary level of protection without breaking the bank. By exploring options for affordable umbrella insurance, business owners can ensure their financial stability and protect their hard-earned assets in the event of unforeseen circumstances.

It can cover your specific liabilities

If your business has employees who drive from one job site to another or regularly make deliveries and pickups, you should consider investing in an umbrella policy. Accidents can happen unexpectedly. Even a momentary lapse of attention can cause a severe accident involving multiple vehicles and passengers. In such cases, the limits of your commercial auto policy may not be enough to cover the resulting medical expenses or legal settlements.

By having an umbrella policy in place, any additional costs beyond your primary coverage will be taken care of. An umbrella policy can provide extra protection for your business.

It can give you peace of mind

As lawsuits and their payouts have increased in recent years, businesses with coverage limited to $1,000,000 may face significant financial strain if a judgment exceeds this amount. Business owners may be forced to pay for the remaining legal costs out of pocket. Obtaining an umbrella policy can ensure that any excess costs beyond their primary coverage will be taken care of, including legal fees.

Having an umbrella policy in place offers peace of mind, allowing entrepreneurs to focus on running their businesses without worrying about potential financial losses from lawsuits. In challenging situations, having adequate coverage can help businesses survive and thrive.

7 of the Best Umbrella Insurance Providers at a Glance

• Travelers: overall best for small businesses
• Chubb: Best for business owner’s policies (BOPs)
• Farmers Insurance: best for bundling home, auto, and small-business insurance
• Insureon: best for customer service
• Nationwide: best for specialized business insurance coverage
• Paychex: best for additional business services
• The Hartford: best for financial strength

Travelers

Founded in 1864, Travelers is a well-established insurance company with a broad network of 13,500 independent agents and brokers operating throughout the United States, Canada, and the United Kingdom. The company offers a range of insurance options, including personal and commercial umbrella policies, suitable for businesses of all sizes and types.

With an impressive A++ (Superior) rating from AM Best, Travelers is recognized for its financial strength and commitment to providing exceptional service to its clients. Policies are available in all 50 states, making Travelers a convenient and reliable choice for businesses seeking comprehensive coverage.

Chubb

Chubb has been operating since 1882 and offers a diverse range of insurance products. It is recognized as the largest publicly traded property and casualty insurance company in the United States as well as the largest commercial insurer. Chubb has earned the highest possible rating of A++ (Superior) from AM Best.

Chubb offers both personal and commercial umbrella insurance. Their umbrella insurance policies cover all legal expenses associated with a covered event, in addition to any settlement amount. This means that legal defense costs are not included in the coverage limit. Chubb policies also protect against libel and slander lawsuits as well as accidents involving uninsured or underinsured drivers.

Farmers Insurance

Farmers Insurance is a significant player in the home and auto insurance industries, offering various insurance products for small businesses. Business owners who already have auto or home insurance through Farmers or plan to buy an umbrella policy may be eligible for multiline discounts. Umbrella insurance policies are available for purchase in increments of $1 million and can provide coverage up to $10 million for qualifying businesses in the event of covered claims.

Insureon

Insureon is an independent agency that specializes in delivering small business insurance online. They allow business owners to compare insurance quotes from top-rated companies, purchase policies, and manage their coverage online. The company is licensed in all 50 states and has expertise in numerous industries, ranging from information technology to hospitality. Insureon is known for its excellent customer service.

With a simple process that takes as few as fifteen minutes, business owners can get a quote by telling Insureon about their business. The agency looks at quotes from over 35 A-rated insurance companies and presents the options that best meet the business's needs. This approach allows business owners to quickly and easily find the insurance coverage they need to protect their business without any hassle.

Nationwide

Nationwide has been in business for over 90 years and has grown from a small mutual auto insurer owned by policyholders to become one of the world's largest insurance and financial services companies.

Nationwide offers a wide range of business insurance options, from standard policies to specialized coverage tailored to specific industries like construction, retail, and agriculture. If your business requires customized insurance coverage, Nationwide might be a good fit for you.

Paychex

Paychex has been providing payroll and HR solutions to small-to-medium-sized businesses since its inception in 1971. Apart from its major services, Paychex also offers umbrella insurance policies.

Paychex’s additional services include financial advisor partnerships management, payment processing, business insurance, and payroll tax services. With its diverse range of services, Paychex is well-positioned to cater to the needs of businesses of various sizes and industries.

The Hartford

The Hartford has been in the insurance business for over two centuries and offers a wide range of insurance products for businesses of all sizes. What sets The Hartford apart from other insurance providers is its exceptional customer service. The company has a team of experienced professionals dedicated to providing policyholders with top-notch support and assistance.

One of the standout products offered by The Hartford is its customizable BOPs, which are designed to cater to the unique needs of each business. Unlike other insurers that only offer general liability and property coverage, The Hartford's BOPs include business interruption insurance. This coverage protects against lost income resulting from events covered by the policy. The Hartford's BOPs also allow businesses to include other necessary coverages at an affordable price.

How Much Does an Umbrella Insurance Policy Cost?

Rates vary based on industry and provider. Personal umbrella coverage is typically affordable since it supplements other policies and covers relatively unlikely events. As this is a supplementary form of insurance, it is important to note that you must first obtain the maximum level of coverage available on your other liability policies before purchasing personal umbrella coverage. Therefore, you might pay more to meet this requirement.

Find the Cheapest Umbrella Insurance Policy Today

Umbrella insurance policies provide additional coverage beyond the limits of your other liability policies. This type of insurance is valuable for businesses that may face high-risk situations or have significant assets to protect. With umbrella insurance, your company can have adequate protection against a wide range of potential risks, including lawsuits and property damage. Although umbrella insurance is an additional expense, it is a worthwhile investment in the long run. Purchase an umbrella insurance policy to secure maximum protection for your company.

Cheapest Umbrella Insurance Policy FAQ

Is an umbrella insurance policy tax deductible?

If you own a personal umbrella policy, the premiums you pay are usually not eligible for a tax deduction. However, if you have a business and purchase an umbrella policy that supplements your other liability policies, the premiums you pay for the business policy may be tax-deductible.

How much umbrella insurance coverage should I carry?

To determine the appropriate amount of umbrella insurance to carry, there are a few factors to consider. First, consider the risks that your business may face. This includes potential hazards to employees, customers, and the general public. Second, evaluate the total value of your assets, including properties, equipment, and investments. Typically, the more assets you have, the higher the umbrella policy limit you should consider. Finally, it's important to consider the potential loss of future income. Liability lawsuits can result in the loss of both current assets and future earnings, even for companies with few assets.

What is not covered by an umbrella insurance policy?

An umbrella liability policy does not provide coverage for excess claims against professional liability insurance, also known as errors and omissions insurance (E&O), medical malpractice insurance, commercial property insurance, or commercial crime insurance. Contact individual insurance providers for details regarding their policies.

How can I purchase an umbrella insurance policy?

Business insurance providers typically offer business umbrella insurance policies. An online insurance marketplace can provide a simple way to shop around for coverage and compare quotes from different providers side by side. This allows you to make an informed decision and select the best coverage for your business at a competitive price.