James McAluney: Does Your Business Carry a Commercial Umbrella?

Hawaii contains some of the rainiest regions on earth. Anyone who doesn’t carry an umbrella or raincoat is asking to get soaked. Similarly, business owners who choose not to carry commercial umbrella insurance are ill prepared for a heavy “downpour” of a lawsuit. For example, what would happen if your company vehicle was involved in an accident that seriously injured a corporate executive? She cannot legitimately return to work and her normal salary exceeds a million per year. Your lawyer asks if you have umbrella insurance. But what exactly is commercial umbrella insurance and how does it work?

Commercial Umbrella Insurance 101

Regular commercial insurances normally have valuations that will cover specific risks associated with a business. However, when certain limits are reached, the insurance is no longer valid. This rarely happens when a professional evaluates a company’s insurance needs because usually the amount of insurance covers a little more than the risk’s potential damages. “When a lawsuit occurs,” says insurance professional James McAluney, “it is nearly impossible to predict how much a negative judgment or settlement could cost your company.” Annual premiums for umbrella insurance is typically less expensive than raising other insurance limits.

Commercial umbrella insurance provides extra coverage in cases where lawsuit damages exceed the limits of general liability coverage. Businesses can select from a number of umbrella insurance types. James McAluney helps businesses identify potential risks and recommends umbrella coverage that works well in a company budget. “The advantages of commercial umbrella insurance are trifold,” says Jim McAluney. “The additional insurance can amount to well over a million dollars, it covers costs that are incurred by lawyers and legal fees, and it protects businesses against non-specific items uncovered by liability.”

Assets and income are at risk in sizable lawsuits. Only umbrella insurance can protect your interests if a judgment comes against you and your business. Medical bills, pain and suffering, lost wages and other costs could wipe out an unprotected business. “When compared to the costs associated with the potential loss,” McAluney states, “umbrella insurance is one of the best options that business owners can use.” The increased layer of protection helps to ensure that your business can weather through even the worst financial storms.

In nearly every industry, there are things that a business cannot afford to lose because of their integral play in creating revenue. Manufacturing companies require certain machines to make profit, while hospitality businesses need real estate to stay operable. “If a judgment were to mandate the sale of such items to cover damages, business owners would be forced to pay for such items out of pocket,” warns McAluney. Without umbrella insurance, the operation of your business could be severely compromised.

So instead of hoping that a lawsuit does not rain on your parade, it is best to carry commercial umbrella insurance just in case the unforeseeable happens. James McAluney, who has lived in Hawaii since 1990, has assisted numerous businesses in securing the right insurance for their needs.