Excess Layer Insurance is taken out by companies that need to take out increased Public Liability Insurance.
Most insurers will increase the limit on your current policy for an additional premium, however some insurers are limited as to how much cover they can give you.
When this happens a separate policy is needed to ‘top up’ your cover
- ABC Construction Limited has been awarded a contract by the local council, but the council insist on them having £10 million Public Liability cover. Their insurance company can only give up to £5 million of cover. In order to get cover up to £10 million to satisfy the council, ABC Construction take an excess layer policy, giving them an extra £5 million, making the total £10 million.
What does Excess Layer Insurance cover
Excess Layer Insurance cover is basically a top up of existing Public Liability cover.
So it therefore should include as a minimum:
- Liability arising from third party property damage
- Liability arising from third party injuries
- Liability arising from products supplied (where applicable)
What to look out for with Excess Layer Insurance
Normally Excess Layer Insurers will match the same terms and conditions as your current Public Liability cover, however you should check to make sure there are no other terms and conditions that you need to adhere to.
- Your main Liability Insurance may cover you for work involving heat, but you would want to make sure that your Excess Layer policy doesn’t exclude this type of work.
Another reason to buy Excess Layer Insurance
It can sometimes be cheaper to arrange Excess Layer Insurance instead of buying all of the cover required from your existing insurer, even if your existing insurer is happy to provide the cover you need,
- ABC Construction Limited, get a quote from their current insurer to increase their Public Liability Insurance limit from £5 million to £10 million. The total annual cost is £547.50. An Excess Layer Insurer offers a quote for an additional £5 million Public Liability cover, giving them a total of £10 million giving them a total of £328.50.
In this example you can see that it is cheaper for ABC Construction to get £10 million Public Liability Cover by taking out a Excess Layer Insurance policy.
Every case is different however, it is important that you take advice from an experienced Business Insurance Broker, to make sure you are getting the correct cover for a competitive premium.
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