Extra liability insurance that sits on top of your other policies and pays when those limits run out.
An umbrella policy provides additional liability coverage above the limits of multiple underlying policies—such as CGL, auto liability, and employer's liability—and may also fill gaps where the underlying policy does not respond. Unlike excess liability, an umbrella policy can drop down to provide primary coverage for uncovered claims that exceed the underlying policy's retention. Large construction projects frequently require contractors to carry $5–$25 million umbrella limits.
A contractor carries $1 million CGL and a $5 million umbrella; a $4 million jury verdict is covered—$1 million by the CGL and $3 million by the umbrella.
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