Commercial umbrella liability insurance gives you extended coverage for your business beyond the limits of your other liability policies. A commercial or business umbrella would pick up where your business auto liability, general liability, workers comp or other liability coverages stop. This extra coverage is important to protect your business should one occurrence be so severe that the first layer limits of your liability coverage are not enough, or if a series of occurrences or claims exhaust your first layer of liability.
That extra layer of liability coverage could be needed in the case of a serious auto accident, a bad slip-and-fall claim, an occurrence where multiple people are hurt, or a fire that starts due to your negligence gets out of control and damages multiple buildings. Any one of these scenarios could exceed the limits of your standard liability policy. A commercial umbrella policy will protect you because the underlying policy limits are used first and your commercial umbrella coverage limits only kick in after those policies have reached their limits.
A form of liability insurance protecting policyholders for claims in excess of the limits of their primary business automobile, general liability, and workers compensation policies. It also provides coverage for some sources of loss that are not covered by their primary policies. Such cases are subject to a deductible (or self-insured retention).