An additional liability insurance policy that provides coverage above and beyond the limits of the building's primary general liability and property insurance policies. Landlords often pass through umbrella insurance premiums as part of CAM or insurance charges.
Umbrella insurance (also called excess liability insurance) sits above the primary commercial general liability (CGL) policy and provides additional coverage once the underlying policy limits are exhausted. In a commercial building context, the landlord purchases umbrella coverage to protect against catastrophic claims. The premium is typically passed through to tenants as part of the insurance component of operating expenses. The appropriateness of the coverage level and the allocation method are both auditable.
A landlord increases umbrella coverage from $5M to $25M after acquiring additional properties, then allocates the entire premium increase across tenants of the original building. Tenants at the original property pay for coverage that protects the landlord's expanded portfolio.
Request a copy of the umbrella policy declarations page to verify the coverage amount and that it covers only your building, not the landlord's entire portfolio. If the landlord owns multiple properties, the umbrella premium should be allocated among all properties, not charged entirely to one.
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Find My OverchargesThis page provides general educational information. It is not legal advice and may not reflect the most current law in your state. Consult a licensed attorney for advice specific to your situation.
