| Umbrella Insurance: |
| Home | Terms of Use | Privacy Notice | Contact Us Copyright © 2008 - 2011 by Byrne - Kim & Assoc Ins Svcs, Inc |
Umbrella Insurance/Excess Liability Coverage
What is Umbrella/Excess Liability Insurance?
Umbrella Liability, also known as Excess Liability Insurance, provides excess liability coverage over
underlying liability policies. Excess coverage may be provided over the general liability, non owned or
business auto and worker's compensation (employers liability section) policies, all your policies under one
Excess Policy. For your policies to be covered under an umbrella, each policy needs to be scheduled by the
umbrella carrier. To be scheduled and qualify for coverage under the umbrella policy, the primary policy or
policies need to meet minimum limits and minimum ratings set by the carrier.
(as a rule it is always recommended to be sure your inception and expiration dates are concurrent. For
example an insured may purchase a primary general liability policy on January 01, with an aggregate of
$1,000,000 and then on June 01, the insured purchases an umbrella/excess policy over the general liability
policy. Now the umbrella policy is covering $1,000,000 aggregate, now lets assume that back on March 05,
there was a general liability incident, but the insured was only notified on September 02, and the claim
settled for $500,000, reducing the aggregate to $500,000. Now when the umbrella was purchased the
inception date was June 01, and the umbrella/excess policy is assuming that it is covering $1,000,000 limits
before it then has to kick in, so imagine the insured has another claim for $1,500,000, the umbrella/excess
policy is not going to kick in until the $1,000,000 is met first. So this means that the insured now has a
deductible of $500,000, remember it is always recommended to have concurrent dates on all polices).
The primary feature of umbrella protection is an additional amount of liability insurance, in increments of
$1,000,000, that is excess over your primary policy/policies. It covers everything except what is otherwise
excluded. As with other liability policies, its primary coverage is for bodily injury and property damage to
others.
An umbrella serves two purposes. First, it provides catastrophe limits over the primary policy, in the event
of a serious accident, where a single claim could exceed the primary policy limit, the umbrella would
provide coverage. Second, in the event that paid claims reduce the limits available under the primary policy,
the umbrella will cover any additional claims which the primary policy would otherwise have covered.
Should the primary carrier become insolvent, the umbrella could also provide drop down coverage. Under
these coverage sections, the umbrella basically provides what is referred to as "following form" coverage.
It covers exactly what the underlying policy/policies cover.
Please note that Umbrella coverage does not apply to the Professional Liability Policy.
What is Umbrella/Excess Liability Insurance?
Umbrella Liability, also known as Excess Liability Insurance, provides excess liability coverage over
underlying liability policies. Excess coverage may be provided over the general liability, non owned or
business auto and worker's compensation (employers liability section) policies, all your policies under one
Excess Policy. For your policies to be covered under an umbrella, each policy needs to be scheduled by the
umbrella carrier. To be scheduled and qualify for coverage under the umbrella policy, the primary policy or
policies need to meet minimum limits and minimum ratings set by the carrier.
(as a rule it is always recommended to be sure your inception and expiration dates are concurrent. For
example an insured may purchase a primary general liability policy on January 01, with an aggregate of
$1,000,000 and then on June 01, the insured purchases an umbrella/excess policy over the general liability
policy. Now the umbrella policy is covering $1,000,000 aggregate, now lets assume that back on March 05,
there was a general liability incident, but the insured was only notified on September 02, and the claim
settled for $500,000, reducing the aggregate to $500,000. Now when the umbrella was purchased the
inception date was June 01, and the umbrella/excess policy is assuming that it is covering $1,000,000 limits
before it then has to kick in, so imagine the insured has another claim for $1,500,000, the umbrella/excess
policy is not going to kick in until the $1,000,000 is met first. So this means that the insured now has a
deductible of $500,000, remember it is always recommended to have concurrent dates on all polices).
The primary feature of umbrella protection is an additional amount of liability insurance, in increments of
$1,000,000, that is excess over your primary policy/policies. It covers everything except what is otherwise
excluded. As with other liability policies, its primary coverage is for bodily injury and property damage to
others.
An umbrella serves two purposes. First, it provides catastrophe limits over the primary policy, in the event
of a serious accident, where a single claim could exceed the primary policy limit, the umbrella would
provide coverage. Second, in the event that paid claims reduce the limits available under the primary policy,
the umbrella will cover any additional claims which the primary policy would otherwise have covered.
Should the primary carrier become insolvent, the umbrella could also provide drop down coverage. Under
these coverage sections, the umbrella basically provides what is referred to as "following form" coverage.
It covers exactly what the underlying policy/policies cover.
Please note that Umbrella coverage does not apply to the Professional Liability Policy.
Contact us today!
Tel. (949) 249-2540
Or use our Contact Us form to
submit an email.
Tel. (949) 249-2540
Or use our Contact Us form to
submit an email.
| Home | Site Map | Contact Us |
| About Us | Services | Resources | Client Log In | Employment |