Principles of Risk Management and Insurance, 13th Edition

Commercial Umbrella Policy

Because firms can be sued for large amounts, they may seek protection against catastrophic loss exposures not adequately insured under general liability policies. A commercial umbrella policy can provide protection against catastrophic liability judgments that might otherwise bankrupt a firm.

Most insurers that write commercial umbrella policies use their own forms. However, the Insurance Services Office has also designed a standard umbrella policy for commercial firms. The following discussion summarizes the major provisions in the ISO commercial liability umbrella coverage form.¹⁴

Coverages

The ISO commercial umbrella policy pays the ultimate net loss in excess of the retained limit for bodily injury, property damage, ...