For years, David ran a small but successful electrical contracting business in Georgia. He had all the right insurance—general liability, workers’ compensation, and commercial auto coverage. But one project changed everything.
His team was rewiring an older commercial building when a faulty connection sparked an electrical fire. The fire caused extensive property damage, and worse, an employee suffered serious burns. Lawsuits followed, and before David knew it, the claims exceeded the limits of his general liability and workers’ compensation policies.
David assumed his coverage would protect him, but once his primary policies maxed out, he was personally responsible for the rest. If he had umbrella insurance, it would have covered the remaining costs instead of putting his business and personal assets on the line.
What Is Umbrella Insurance and Why Do Electricians Need It?
Running an electrical business means working with high-voltage systems, job site risks, and expensive equipment. Even with standard insurance policies, a single high-dollar claim can push coverage limits to the breaking point. Umbrella insurance acts as a financial safety net, providing extra liability protection beyond your existing policies.
For electricians, high-risk jobs and costly liability claims make umbrella insurance more than just an extra layer of protection—it’s a business necessity.
What Does Umbrella Insurance Cover?
Umbrella insurance kicks in when claims exceed the limits of your other business policies. It provides:
Extra Coverage for General Liability Claims
Your general liability insurance covers property damage and bodily injury caused by your work, but what happens when a claim surpasses your coverage limit? Umbrella insurance helps cover the remaining balance, so you’re not paying out of pocket.
Higher Limits for Auto Liability
Commercial auto insurance covers your work vehicles, but serious accidents can lead to lawsuits that exceed your policy’s max payout. If one of your electricians is involved in a major crash while driving a company van, umbrella insurance extends the coverage beyond your standard auto liability limits.
Protection from Large Workers’ Compensation Claims
Workers’ compensation insurance covers employee injuries, but severe accidents may result in legal action against your business if your coverage isn’t enough. An umbrella policy helps protect you from financially crippling claims.
Coverage for Third-Party Injury Lawsuits
If a client, vendor, or job site visitor suffers a serious injury because of your work, they may sue for damages. If your primary insurance doesn’t cover the full amount, umbrella insurance fills in the gap to prevent financial loss.
When Would an Electrician Need Umbrella Insurance?
Umbrella insurance isn’t just for big corporations—it’s for any electrician who could face a lawsuit that surpasses standard insurance limits. Here are a few real-world examples where it matters:
A Job Site Fire Leads to Extensive Damage
An electrician installs wiring in a commercial building, but a hidden fault causes an electrical fire days later. The property owner sues for hundreds of thousands in damages. General liability insurance covers part of it, but the remaining cost falls on the business—unless umbrella insurance is in place.
An Auto Accident Results in a Lawsuit
A company truck collides with another vehicle on the way to a job site, injuring multiple people. The medical bills and lawsuits exceed the commercial auto policy’s limits, and without umbrella coverage, the business must cover the remaining expenses.
A Third-Party Injury Triggers a Large Settlement
An electrician accidentally leaves tools in a customer’s hallway, causing them to trip and suffer a serious injury. The medical bills, rehabilitation costs, and lost wages lead to a lawsuit that general liability alone won’t cover.
How Much Umbrella Insurance Does an Electrician Need?
The right amount depends on the size of your business, number of employees, and level of risk. Coverage typically starts at $1 million and can extend into the millions based on your business needs.
For electrical contractors working on large commercial projects, additional umbrella coverage is often required by contract. Even smaller businesses should consider at least $1 to $2 million in umbrella coverage to protect against high-cost claims.
How Much Does Umbrella Insurance Cost?
Compared to the potential financial devastation of a lawsuit, umbrella insurance is affordable.
- Policies typically start at a few hundred dollars per year per million dollars of coverage.
- The cost varies based on business size, claims history, and coverage limits.
- Compared to raising individual policy limits, umbrella insurance provides more coverage at a lower cost.
For electrical contractors, umbrella insurance is a cost-effective way to prevent a single claim from destroying your business.
How Arrow Insurance Agency Helps Electricians Stay Protected
At Arrow Insurance Agency, we know how unpredictable the electrical industry can be. That’s why we help electricians find affordable umbrella coverage that fits their business.
Custom Umbrella Policies for Electrical Contractors
We assess your business risks and coverage needs to find a policy that extends your protection without breaking your budget.
Guidance on Proper Coverage Limits
Not sure how much coverage you need? We help electricians determine the right umbrella policy amount to cover worst-case scenarios.
Comprehensive Insurance Solutions
We don’t just stop at umbrella insurance—we ensure your business is covered with general liability, workers’ compensation, commercial auto, and tools & equipment coverage.
Don’t Let One Lawsuit Threaten Everything You’ve Built
Electrical businesses face unique risks, and sometimes, standard coverage isn’t enough. Umbrella insurance gives you peace of mind knowing your business is protected from major claims that could exceed your policy limits.
Arrow Insurance Agency is here to help electricians in Georgia, Florida, Alabama, and South Carolina find the right umbrella insurance coverage. Contact us today to discuss how we can safeguard your business from high-cost liability claims.
Zaheed Hussain – Owner/Founder
Arrow Insurance Agency is dedicated to protecting families and businesses with customized insurance solutions. Based in Loganville, Georgia, we proudly serve the surrounding communities as well as the states of Florida, Alabama, and South Carolina. As an independent insurance agency, we work with top-rated carriers to help clients save money, reduce risk, and safeguard their financial future. Whether you need coverage for your home, auto, or business, Arrow Insurance Agency is committed to providing personalized service that treats you like family.
