Business insurance
Commercial umbrella and excess liability
The extra layer contracts increasingly demand, sitting above your general liability, your commercial auto and usually your employers liability. Cheap for what it does, and not quite the same thing as the excess policy some brokers will sell you instead.
A commercial umbrella provides limits above your underlying liability policies and, on a true umbrella form, can also drop down to cover some claims the underlying policies exclude, subject to a self-insured retention. It is priced off the underlying policies rather than independently, which is why it is inexpensive relative to the limit it provides.
The reason most Queens businesses buy one is not risk analysis. It is that a contract requires it — general contractors, landlords, municipalities and institutional clients now routinely specify combined limits that only an umbrella can reach. That is a perfectly good reason, and it is worth buying the right version while you are at it.
Umbrella against excess, which is not a quibble
A follow-form excess policy does exactly what its underlying policy does, just with more limit. If the underlying policy excludes something, so does the excess.
A true umbrella provides that extra limit and can also respond to some claims the underlying does not cover at all, where you pay a self-insured retention first. That broader drop-down is the difference between the two, and the price difference is often small. When a broker quotes you 'excess liability' at an attractive number, it is worth asking which of the two you are being offered.
What it has to sit above
The carrier will require specified underlying limits — commonly $1,000,000 per occurrence on general liability with a $2,000,000 aggregate, $1,000,000 on commercial auto, and employers liability at stated limits on the workers compensation policy. If your underlying limits are lower, they have to be raised before the umbrella can attach.
This creates a real trap. If an underlying policy lapses, is cancelled or is written at limits below the umbrella's requirements, the umbrella does not simply drop down to fill the space — you are treated as self-insured for the difference. Keeping all the policies at one agency is not a sales argument; it is the only reliable way to make sure the layers still line up after a renewal.
Why contracts ask for it
Because the party imposing the requirement is protecting itself, and their risk manager has set a number. Requirements of $2,000,000, $5,000,000 or more in combined limits are now common on construction subcontracts, commercial leases and public work, and they are usually accompanied by additional insured and primary and non-contributory requirements that must flow up through the umbrella as well as the underlying policy.
That flow-up is the detail people miss. An umbrella that does not follow the additional insured status of the underlying policy does not satisfy a contract requiring the limit to be available to the additional insured. Send us the contract; this is exactly the sort of thing that is easier to arrange at placement than to argue about at a claim.
What it does not cover
Professional liability, unless specifically scheduled. Cyber, likewise. Workers compensation benefits themselves — the umbrella sits above employers liability, which is the tort side, not above the statutory benefits. Pollution, generally. And your own property, since it is a liability policy throughout.
For a firm carrying professional liability, the useful question is whether the umbrella can be endorsed to sit above it. Some will, most will not, and where it cannot the answer is a higher primary professional limit rather than assuming the umbrella has you covered.
A certificate reports cover; it does not create any. A certificate of insurance is evidence, not cover. It is a snapshot of what was in force on the day it printed, it confers no rights on the person holding it, and it does not amend the policy. If your contract needs somebody named as an additional insured, or needs a waiver of subrogation, that comes from an endorsement on the policy — which costs something, has to be requested, and is the only thing that actually changes what is covered. We will not issue a certificate describing cover that has not been endorsed, however urgently the general contractor wants it.
Included as standard
How we handle this line
Umbrella rather than excess where available
The drop-down cover is the difference between the two forms and the price gap is usually small.
Underlying limits verified
If an underlying policy falls below the umbrella's requirements you are self-insured for the gap. We check them at every renewal.
Contract requirements matched
Including additional insured status flowing up through the umbrella, which is the detail that most often fails to satisfy a contract.
All layers renewed together
Keeping the policies aligned is the only reliable way to stop a renewal quietly breaking the structure.
Professional and cyber addressed separately
The umbrella generally does not sit above either. Where it cannot, the answer is a higher primary limit, and we say so.
Priced at several limits
$1M, $2M and $5M side by side, because the second and third million cost far less than the first.
When to ring us
Signs this is worth a conversation
- A contract or lease requires combined limits above $1,000,000.
- You have raised your underlying limits and nobody rechecked the umbrella.
- Your policies renew at different times with different agencies.
- You were sold excess liability and do not know whether it is a true umbrella.
- You carry professional liability and assume the umbrella sits above it.
- You have employees, vehicles and a public premises, all at minimum limits.
Commercial umbrella — what it typically costs
- Typical annual premium for the first $1M of commercial umbrella, priced off the underlying policies rather than independently.$900 – $4,500
This is a typical premium range for this area. It is not a quote, and it is not our price. We do not set premiums: a carrier files its rates with the Department of Financial Services and our commission is already inside the filed rate, so the same policy from the same carrier costs the same through any producer in New York. What genuinely moves your own number is which carrier writes it, the limits and deductibles you choose, and the facts on your record — which is what we would go through with you before anything is quoted.
Questions we are actually asked
Commercial umbrella — frequently asked
What is the difference between umbrella and excess liability?
A follow-form excess policy mirrors the underlying policy with a higher limit and the same exclusions. A true umbrella provides the higher limit and can also drop down to cover some claims the underlying policy excludes, after a self-insured retention. The price difference is often small and the coverage difference is not.
How much is a commercial umbrella?
Typically $900 to $4,500 a year for the first $1,000,000, priced off your underlying general liability, auto and employers liability rather than rated independently. Additional millions cost substantially less than the first.
Does the umbrella cover professional liability?
Generally not unless it is specifically scheduled, and most will not schedule it. If you carry professional liability, the way to get more limit there is usually to raise the primary policy rather than to rely on the umbrella.
What if one of my underlying policies lapses?
You are treated as self-insured for the amount that policy should have provided — the umbrella does not drop down to fill it. This is the practical reason to keep the layers with one agency and to have every renewal checked against the umbrella's requirements.
Related cover
Usually considered alongside this
General liability
The policy every landlord and every general contractor asks you for, priced off your receipts and your trade rather than your luck.
$600 – $2,400
Business insurance
The businessowners policy that covers most small Queens businesses properly, and the four risks it is famous for leaving out.
$800 – $2,800
Contractors insurance
Liability, tools, the vehicle and the certificate the general contractor wants by Friday — plus New York Labour Law 240, which changes the arithmetic entirely.
$1,800 – $9,500
Umbrella insurance
A million dollars of liability sitting above the policies you already have, for roughly the price of a month of car insurance.
$250 – $600Bring the declarations page and we will read it with you
Ask us what it would cost
Send or bring the summary pages of what you already have — those two sheets are where most of the useful conversation is. We will tell you what we would place it with and what that would cost, what we are paid for doing it, and whether you should move at all. Quite often the answer is that your current policy is priced fairly and you should keep it, and that is an answer we give in writing like any other.