When does umbrella insurance kick in?

Umbrella insurance from Ellis Insurance Agency is a type of extra liability coverage that can provide additional protection when your existing auto or home insurance policies here in the San Antonio, TX area don’t cover the full extent of a liability claim.

When does umbrella insurance kick in?

It can kick in when the amount you are liable for exceeds the limits of your existing insurance policies, protecting you from potential financial ruin. 

It’s important to remember that umbrella insurance does not replace any other policies you may have. It’s designed to supplement and extend the limits of your existing auto, home, and other liability policies, helping you protect yourself from claims that exceed those limits. 

When it comes to knowing when umbrella insurance kicks in, there isn’t a single answer since it depends on various factors such as the policy limits of your existing coverage and claims made against you. Generally speaking, if there is a claim made against you resulting in damages greater than what your existing policies cover, umbrella insurance will cover any remaining costs up to its limit. 

Umbrella insurance can be an essential layer of additional protection for those who need more coverage than their existing policy provides. However, it’s important to speak with an experienced and licensed insurance agent who can help you determine what type and how much umbrella coverage is right for you.

Reach Out To Us

For more information or to find a policy that is right for you, give us at Ellis Insurance Agency a call today. We are proud to serve the San Antonio, TX area and would be happy to help you find a policy that meets both your needs and your budget. So call us today!

Insurance Audit

Receiving a notice of an audit can sometimes cause a business owner stress; although, that’s not the intention. An audit is performed to ensure you have the appropriate premium for your exposure, or the thing for which you have insurance. Your initial deposit premium was based on your best estimate of the auditable exposure (payroll, sales, etc.). Insurance companies use a Premium Auditor at the end of the policy period to compare the “actual” auditable exposure against your “estimated” amount.

What is an Insurance Audit?

An insurance audit examines your business’ payroll or gross annual sales and risk exposure. An audit makes sure you’re paying the correct amount for insurance.

What happens in an Insurance Audit?

The word “audit” may sound stressful, but don’t panic. At the beginning of the year, you pay a certain amount for coverage. If you’re asked to go through an audit at the end of the year, an auditor, hired from the insurance company, reviews your business’ payroll and other documents to determine if the premium you paid was accurate.

An audit looks at some or the following:

  • Your business’ gross annual sales
  • Job duties of employees and independent contractors
  • Changes from the prior year
  • Your annual payroll to W2 and 1099 workers

Depending on the audit results, you could have additional premium due because you needed more coverage, so you’ll have to pay the difference.

Preparing for a Premium Audit

Having the necessary documents and information can make for a smooth audit. Some documents you may need include:

  • Payroll (for your W2 and 1099 workers)
  • Certificates of insurance (for your 1099 workers or a waiver signed from them)
  • Tax documents
  • Subcontractor or independent contractor documents

Do I have to do an Insurance Audit?

Insurance companies may perform an insurance audit at the end of the year for:

  • General liability insurance
  • Workers’ compensation insurance
  • Commercial property insurance

If you’re notified of an insurance audit it’s important to send your insurance company any documents or information they ask for. Completing an insurance audit, or any type of insurance audit ensures you’re paying for the right amount for coverage.

Be aware that if you don’t complete an insurance audit, your insurer can:

  • Charge a premium increase. In some cases, this can be a significant amount.
  • Cancel your policy, leaving you without coverage.
  • Report you to a collection agency if there’s a balance due on your premium and you don’t pay it.

Learn More About Audits and Coverage

Choosing the right policy and coverages is important and can help you run a successful business.  Insurance is backed by years of experience and know every business owner has unique needs. Our specialists are here to help you every step of the way. So, if you need help completing an insurance audit or have any other questions, we’ve got your back.