Solutions to Protect Against a Catastrophic Claim
There are a number of ways to protect against a catastrophic liability claim as a New Jersey
contractor. The most common ways are generally what are referred as Umbrella Policies or Excess
Liability policies. Both of these policies are generally purchased in increments of $1M.
An Umbrella policy is a separate policy that goes above and beyond your underlying policies. Your
Commercial General Liability Insurance
policy (which as we have shown is the backbone of your contractor liability insurance portfolio) as
well as the other policies in your commercial portfolio.
An Excess liability policy is simply that - one policy that is in excess of one but not all of your
policies. Typically, Umbrella policies provide at least similar coverage to your underlying
contractor insurance policies and, in many cases, broaden coverage.
Another benefit to Umbrella or Excess Liability policies is that, simply based on the dollars
involved for the insurance company, they will assign their best or most senior claims adjusters
to your claim. It makes complete sense. For an Umbrella claim adjuster to be called in, the
claim is being reserved or in the insurance company's estimation the claim could be in excess
of $1 million. Umbrella adjusters do not get called in for small claims. The very nature of
their job is that for their phone to ring - there are big dollars at risk.
What Your Agent Should Be Able To Explain To You
You are entrusting insuring your contracting business to an agent or different agents and possibly
a combination of insurance companies. As I have said, Excess or Umbrella policies are an excellent
way to protect your New Jersey contracting business. For many contractors they will be put in the
position of securing higher limits of general liability as you will be required to do so either by
a general contractor or as insurance requirements in a contract you want to execute. Chances are
great that this either has or will happen to you.
Your agent should be able to tell you if the coverage is excess or Umbrella. Is the policy a
follow form? Does the coverage drop down? A vital aspect is making sure that the agent
understands why it is absolutely essential that there be concurrency to avoid any problem with
impaired limits. A New Jersey contractor liability insurance specialist will be able to seamlessly
integrate these facets together. A generalist may not be aware of these intricacies and, in total
candor, a mistake at this level by its very definition is disastrous.
Call us at (908) 730-6443 or
contact us for answers to your New Jersey Excess Risk Insurance questions.
|