October 7, 2004

How Much Insurance Is Enough?

So you have a client that has a farm package policy and you also handle his commercial farm vehicles and employer liability. It’s time for your annual review and the client wants to make certain that he is properly covered if the event of some awful accident.

In today’s lawsuit crazy atmosphere it should be a concern to have enough coverage. The more you have, the more you are at risk and the more you need to protect yourself. That’s why one might want to look at excess liability insurance.

The legal definition of excess insurance is ‘a policy or bond covering the insured against certain hazards, and applying loss or damage in excess of a stated amount’. Simply put, excess liability insurance provides coverage for claims in excess of general liability, automobile liability, employer’s liability or other primary liability insurance policies.

The excess coverage is usually purchased in amounts ranging from one to five million dollars, but higher limits may be available to qualified candidates. Should a claim arise, the insurance contract will provide coverage on a specific per occurrence or per accident amount or to the yearly aggregate amount.

In order to determine the proper amount of insurance required, your client needs to review his financial status and understand his current insurance coverage. By having a knowledgeable insured you are on the way to providing solid insurance protection.