What is commercial liability umbrella (CLUP) insurance?
In business, it's essential to prepare for both success and setbacks. Commercial liability umbrella insurance may help provide extra coverage for worst-case scenarios that go beyond your current policy limits.
How it works
You have a business insurance policy and an auto policy with liability coverage, but if one of your employees gets into a commercial auto accident and the damages exceed your policy limits, CLUP insurance may help cover the extra costs.
Who may benefit from CLUP?
Any business owner, landlord, farm or ranch owner, or homeowners association may want to consider a CLUP, especially if they have significant auto, general or employer liability risks.
How to determine if you should consider CLUP insurance?
Without CLUP insurance, losing a liability lawsuit has the potential to bankrupt your business. For most businesses, the real question isn't if you need it, but how much you may need, especially if you:
- Use commercial vehicles
- Interact with customers often
- Work on others' property
CLUP insurance may help protect you from catastrophic losses, letting you focus on growing your business.
Your State Farm® agent can help you review and choose the right coverage for your needs.
State Farm Commercial Liability Umbrella Insurance may help protect against:
Commercial auto accidents
If an employee driving the company van is found responsible for a serious multi-car accident, the lawsuit judgments might exceed your current coverage limits. CLUP insurance may help protect you from bankruptcy in that situation.
Damages caused by heavy construction equipment
If your employee is using equipment while working and causes major damage to a customer's property that exceeds your contractor's policy limits, CLUP insurance can help cover the difference.
Business condominium association misconduct
If a homeowners association board of directors are sued for discrimination and/or wrongful eviction, a CLUP may help pay for defense costs and damages.
How much is CLUP insurance?
The cost of CLUP insurance depends on several factors, including the receipts and/or rental income of your business, if autos are included in the coverage, and coverage limits.
Contact your State Farm agent for help!
Coverage in action
If a customer slips and falls on a wet floor at your business and sustains serious injuries, they may choose to sue you. If their medical expenses and legal fees exceed your liability policy limits, CLUP can provide the extra coverage you may need.
Should you consider a business owners policy (BOP)?
Business owners policy may help protect your business from various covered claims, including bodily injury, property damage and injuries done to others that may occur resulting from your organization’s operations.
Frequently asked questions about commercial liability umbrella (CLUP) insurance
Primary liability insurance is provided on your business and auto policies, and umbrella insurance provides coverage over those policies when the business or auto liability limits are not enough.
Umbrella limits start at one million dollars and can be increased.
The umbrella requires that there be coverage provided by an underlying policy (i.e. business or auto policy) before an umbrella policy can be offered.
In general, if the business is eligible, it is likely also eligible for an umbrella policy.
Protect your place from electrical fires
State Farm and Ting could help you prevent electrical fires before they happen – for free.
Explore Ting
Get a local agent who gets you
There’s a State Farm agent nearby ready to offer personalized service to fit your specific needs.
Simple Insights®
Looking for ways to help keep your small business running smoothly? You’ve come to the right place. Articles from Simple Insights draw on over 100 years of State Farm knowledge.
Prices are based on rating plans that may vary by state. Coverage options are selected by the customer, and availability and eligibility may vary.
This is only a general description of coverages of the available types of business insurance and is not a statement of contract. Details of coverage, limits, or services may not be available for all business and vary in some states. All coverages are subject to the terms, provisions, exclusions, and conditions in the policy itself and in any endorsements. Contact a State Farm agent for more information and a customized quote.
State Farm (including State Farm Mutual Automobile Insurance Company and its subsidiaries and affiliates) is not responsible for, and does not endorse or approve, either implicitly or explicitly, the content of any third-party sites hyperlinked from this page. State Farm has no discretion to alter, update, or control the content on the hyperlinked, third-party site. Access to third-party sites is at the user's own risk, is being provided for informational purposes only and is not a solicitation to buy or sell any of the products which may be referenced on such third-party sites.
State Farm Mutual Automobile Insurance Company
State Farm Indemnity Company
State Farm Fire and Casualty Company
State Farm General Insurance Company
State Farm Life Insurance Company (Not licensed in MA, NY or WI)
State Farm Life and Accident Assurance Company (Licensed in NY and WI)
Bloomington, IL
State Farm County Mutual Insurance Company of Texas
State Farm Lloyds
Richardson, TX
State Farm Fire and Casualty Company
Tallahassee, FL