How Does A Commercial Umbrella Policy Work in Your Trucking Business?

Strong Tie Insurance December 27, 2021 Our Blog

Excess and umbrella insurance are frequently used interchangeably in the trucking authority industry. They are, however, two entirely different sorts of insurance coverages.

While both insurances will provide the extra security that truckers and their motor carriers seek, the way the coverage is applied differs significantly. Aside from the legal implications, having insurance coverage protects your company from financial damage in the event of an accident.

Trucking industry businessmen are familiar with primary liability coverage, but are often unaware that secondary liabilities are not covered by your primary policy — this is when a trucker’s umbrella policy may come in handy.

What Is A Commercial Umbrella Policy?

Liability limits on a commercial umbrella policy will be higher than those on your other plans.

This sort of policy provides additional security for you and your company in the case of a catastrophic occurrence that results in lawsuits being filed against you. Where your auto liability, general liability, or other liability coverage ends — a commercial umbrella policy takes over.

Most incidents will be covered by your ordinary policies. However, when a devastating liability loss occurs, an umbrella insurance policy might make the difference between continuing in business and going out of business.

For example, if a claim against you is awarded $2 million and your current general liability policy only covers you for $1 million, your business umbrella coverage can cover the difference. You could be out of business if you don’t have commercial umbrella coverage in place.

Trucking business owners know that successful business ventures may come with a price tag at times, and unless you specifically request it, your primary insurance coverage normally does not cover any of these gaps.

All of these gaps are covered by trucking umbrella insurance or excess insurance, which increases your liability limits.

Commercial Umbrella Policy: What Does it Cover?

Liability claims that exceed the limits of an underlying insurance policy, such as a general liability policy or a commercial auto insurance policy, are covered by commercial umbrella insurance.

Legal fees, medical expenditures, damage to someone else’s property, and court judgments and settlements are all covered by a commercial umbrella insurance policy. Commercial umbrella plans are written by insurance firms with aggregate limits ranging from $1 million to $15 million.

Umbrella insurance is an affordable option to fill up the gaps and expand your liability limits. Make sure you read the policy’s fine print to understand what it covers.

Let’s say one of your drivers got involved in a car accident while on the job, and the accident costs from property damage and bodily injury damage surpass the liability limit on your commercial auto insurance policy because your employee is at fault. 

You would have to pay for those charges out of your pocket if you don’t have commercial umbrella insurance — putting your company in danger.

Characteristics of an Umbrella Policy

Many truck owners are unsure which form of insurance to get. They are unsure if they should purchase excess or umbrella insurance coverage. The qualities of each type, as well as the distinctions between them, are listed below.

One approach to save money on a commercial umbrella policy is to pay the entire price upfront. Making monthly payments may be convenient, but you’ll end up paying more in the long run.

If you have the funds, you could pay your commercial umbrella coverage in full.

Reasons to Consider Commercial Umbrella Insurance

You already have a lot on your mind. Don’t make insurance issues one of the things that keep you awake at night.

You may rest easy knowing that you’re covered with the correct umbrella insurance policy.

Provides Extra Coverage Against Liability

Umbrella insurance is a sort of liability coverage that many truck companies utilize nowadays. It’s made to keep you safe from lawsuits that demand a lot of money. As a result, this kind of trucking insurance safeguards your current assets and the future of your business. 

Covers Multiple Sources of Liability

This policy protects you from lawsuits, property damage, and injuries. It also covers personal liability concerns. The term umbrella refers to the fact that it protects you in a variety of situations.

Increases Convenience for Trucking Businesses

The Umbrella Insurance policy adds an extra layer of protection to your existing policy. It does so by paying for things like legal fees, medical expenditures, and damage charges that aren’t covered by its individual policies

Provides a Unique Level of Protection

There are a variety of alternative insurance products that cover the same risks as umbrella insurance. This coverage, on the other hand, has the distinct advantage of providing protection over and beyond the limitations that other policies can give for the same liabilities.

As the owner of the umbrella insurance policy, it simply gives you more clout.

Do You Need an Umbrella Insurance Policy for Your Trucking Business?

You’ll need extra coverage to protect yourself from litigation that could quickly exceed your current policy limits.

If you’re using semi trucks in your business, which are big and heavy — they can do a lot of damage. When the limits of your existing policies are exceeded, umbrella insurance kicks in and pays out.

This coverage is essential when lawsuits can easily exceed your policy limitations.

Choose the Right Umbrella Policy for Your Trucking Business

The umbrella market is highly unstable and getting multiple quotes on umbrella insurance is the greatest approach to save money.

At Strong Tie Insurance, we can provide competitive quotes that handle your truck business’s particular risk areas. 

Umbrella insurance for businesses may not cover everything. Before you buy insurance, be sure you know what your policy’s exclusions are. We have more than 20 years of experience in providing our clients with cheap commercial insurance that fits their needs.

In addition, we may require that your underlying policy’s limits satisfy a specified level in order to qualify for commercial umbrella coverage

To learn more about umbrella insurance and how it may protect your business, contact us at Strong Tie Insurance today!