An umbrella liability policy provides an insured with an “umbrella” of liability protection over the primarily liability insurance, explain Donald D. Malecki, CPCU, and David D. Thamann, J.D., CPCU, ARM, authors of Commercial General Liability Coverage Guide, 11th Edition.
Most umbrella insurers require you to purchase primary insurance coverage before selling you an umbrella policy—for example, general liability insurance, auto liability insurance, workers compensation or employers liability insurance.
Malecki and Thamann note that an umbrella liability policy, such as ISO commercial umbrella policy, CU 00 01, can provide coverage
- over the primary liability insurance carried by the insured in the event that the primary insurance is exhausted by a loss;
- of liability exposures for which there is no primary insurance; or
- when the primary policy contains an exclusion that is not similarly excluded under the umbrella policy.
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Rosalie Donlon
Rosalie Donlon is the editor in chief of ALM's insurance and tax publications, including NU Property & Casualty magazine and NU PropertyCasualty360.com. You can contact her at [email protected].
