Commercial Coverage

Commercial Auto

Covers liability for bodily injury and physical damage caused by vehicles used for business purposes. Factors such as ownership by a business, use in hauling goods for hire and gross weight determine a vehicle’s eligibility under a commercial auto policy. Except for auto-related businesses, motor carrier and trucking firms, a commercial auto policy addresses the auto insurance needs of most commercial entities. Some small vehicles used for business purposes can be insured on a personal auto policy.

Business Owners Policy (BOP)

Combines property and liability coverage in a package policy for eligible small businesses. A typical BOP covers commercial property, including buildings and contents, and liability protection for the operation of a business at its established location, its products and completed operations. Some policies include business income and extra expense coverage after an insured loss, but not workers' compensation, professional liability or commercial auto coverage.

Business Interruption

Covers the loss of income suffered by a business as a result of not being able to use property damaged by an insured loss during the time required to repair or replace the property. From the time of the loss to when operations are restored, business interruption insurance helps replace lost profits and pay continuing expenses like rent and payroll.

Commercial Umbrella (Excess Liability)

Covers losses that exceed the limits of its underlying insurance policy. Umbrella insurance provides excess limits when the limits of underlying policies are exhausted by the payment of claims, covers exclusions and gaps in underlying policies and provides protection against some claims not covered by underlying policies.

Boiler & Machinery

Covers losses caused by mechanical or electrical equipment breakdown, including damage to the equipment, damage to the business’s other property and damage to the property of others. Lost income is not typically covered under a boiler and machinery policy and must be purchased through additional coverage.

Crime (Fidelity Insurance)

Provides protection against a number of criminal acts by employees, including employee dishonesty, theft of money or securities, forgery or alteration, computer fraud and burglary or robbery.

Kidnap & Ransom (K&R)

Covers loss by the surrendering of property as a result of a threat of harm to the insured, an employee or a relative or guest of the insured or the insured’s employees. K&R policies reimburse loss, such as extortion payments, loss of ransom in transit, crisis management consultant fees, travel fees and medical costs, rather than pay ransoms on behalf of the insured.

Builders Risk

Covers property in the course of construction. It typically applies not only to property at the construction site, but also to property at off-site storage locations and in transit. Builders risk protects against building damage and damaged or lost materials, fixtures and equipment used in construction or renovation. The estimated completed value of the project is used as the limit of coverage, and protection ends when the work is completed.

General Liability

Protects against financial loss resulting from claims of bodily injury, property damage, personal injury, like libel and slander, and advertising injury to others caused by a business or its employees. Exposures come from a broad spectrum of sources, including accidents on the insured premises, employment-related lawsuits and copyright infringement. A general liability policy covers the cost to defend or settle claims even if they are fraudulent. It does not cover auto and professional liability exposures.

Marine

Inland marine is property insurance covering exposures that cannot be reasonably confined to a fixed location or insured under a standard policy. It applies to property in transit over land, certain moveable property, property under construction, instrumentalities of transportation and communication such as bridges, roads, piers or television/radio towers, legal liability coverage for bailees and computerized equipment. Many inland marine policies provide coverage without regard to the location of the property. These are sometimes called “floater” policies.

 

Ocean marine is property insurance covering the transportation of goods and/or merchandise by vessels crossing foreign and domestic waters, including any inland or aviation transit associated with the shipment. Ocean marine insurance also covers damage to vessels involved in shipments and legal liability arising in the course of shipment.

Non-Subscription

Texas employers can opt out of the workers’ compensation system; however, they can be held liable in tort if proven negligent in causing a worker’s injury since they waive the legal defenses available to employers subject to workers’ compensation laws. Nonsubscribers may not argue that the employee’s own negligence or the negligence of another worker contributed to the accident or that the employee voluntarily assumed the risk of injury. A court may order a nonsubscriber to pay for pain and suffering and punitive damages.

There are two types of non-subscriber policies: occupational accident and employers excess indemnity. Occupational accident insurance allows an employer to provide benefits similar to those afforded under workers’ compensation laws. Employers excess indemnity insurance reimburses the employer for liability settlements and judgments applying to pain and suffering, permanent disfigurement and lost future earnings.

Professional Liability

Often called “Errors and Omissions” (E&O), a professional liability policy protects business professionals and companies against liability incurred as a result of errors and omissions in performing professional services. Most E&O policies cover financial losses suffered by third parties as opposed to bodily injury and property damage, which are typically covered under commercial general liability policies.

Workers' Compensation

A statutory benefit prescribed in state law requiring most employers to compensate employees or their families for lost wages and medical care due to job-related injuries resulting from accidents or occupational disease. In exchange, employees relinquish their right to sue their employer for negligence. Workers’ compensation insurance helps cover the cost of injured employees’ medical and income benefits.

Commercial Property

Helps businesses pay to repair or replace buildings, structures and contents that are damaged or destroyed because of fire, storm and other events outlined in the policy. It also pays to replace stolen or lost property. Different policies protect against different risks. Some cover only those risks named in the policy, and others cover all risks except for those that are excluded. Additional coverage may need to be purchased to fully protect a business, depending on what it does and where it is located.

Cyber Liability

Protects companies from exposures encountered when communicating or conducting business online, like breaches of privacy, infringement or misappropriation of intellectual property, employment discrimination, violation of obscenity laws, computer viruses transmission and defamation. Any business that does Internet commerce, has a Web site or stores sensitive electronic information on a network can benefit from a cyber liability insurance policy; however, it is most applicable to technology, financial service and health care companies.

Directors & Officers (D&O) Liability

Protects corporate directors and officers against claims, often made by stockholders, customers and employees, alleging financial loss arising from mismanagement. The policy provides two protections: the first reimburses the insured organization when it is legally obligated to indemnify directors and officers for their acts; the second provides direct coverage to directors and officers when the organization is not legally obligated to indemnify them. Coverage can extend to defense costs for criminal, regulatory and civil trials. D&O policies typically exclude intentional/dishonest acts, bodily injury and property damage, but do include “wrongful acts” such as unintended omissions and misstatements. The underlying principal is that directors and officers must be allowed to take reasonable strategic risks in the course of business without the threat of personal liability.

 

Under state law, directors’ and officers’ personal assets are at risk. So, quality D&O coverage is necessary for a company to attract top directors and officers.

Employment Practices Liability

Employment Practices Liability Insurance (EPLI) covers claims made by employees of wrongful acts resulting from the employment process. The most frequent type of claim alleges wrongful termination, discrimination and sexual harassment. EPLI is available as a stand-alone coverage, but is also frequently offered as an endorsement to directors and officers liability policies.