Umbrella and Excess Liability Insurance for Florida Roofing Companies: Why One Million Dollars Is Often Not Enough

For many Florida roofing companies, carrying a one million dollar general liability policy feels like a major milestone. It satisfies licensing requirements, meets basic contract demands, and checks the box most clients expect to see.

Unfortunately, in today’s legal and construction environment, one million dollars in liability coverage is often not enough.

Roofing companies operate in high-risk environments. Severe injuries, large property losses, and multi-party lawsuits are not rare. When claims exceed the limits of primary insurance policies, the roofing business is responsible for the difference. That is where umbrella and excess liability insurance becomes critical.

---

What Is Umbrella and Excess Liability Insurance?

Umbrella and excess liability insurance provide additional liability limits above underlying policies such as:

• General liability
• Commercial auto
• Employers’ liability (part of workers’ compensation)

While the terms are often used interchangeably, there is an important distinction.

Umbrella Liability Insurance

Umbrella insurance:

• Sits over multiple underlying policies
• May broaden coverage in certain situations
• Provides additional limits once primary policies are exhausted

Excess Liability Insurance

Excess liability insurance:

• Sits over a specific underlying policy
• Provides additional limits only
• Does not typically broaden coverage

For most roofing companies, an umbrella policy is the more flexible and valuable option.

---

Why Roofing Companies Face High-Severity Liability Claims

Roofing is not just frequent-risk work. It is severe-risk work.

Falls and Serious Injuries

If a third party falls from a roof or is struck by falling debris, injuries can be life-altering. Medical bills, long-term care, and lost income claims can exceed one million dollars quickly.

High-Value Property Damage

Florida roofing companies often work on:

• Luxury homes
• Condominiums
• Commercial buildings
• Hotels and resorts

A fire, structural collapse, or major water intrusion can cause extensive damage well beyond basic policy limits.

Multi-Party Lawsuits

Construction claims frequently involve:

• Property owners
• General contractors
• Subcontractors
• Property managers
• HOAs

When multiple parties are involved, legal costs and settlements escalate rapidly.

---

Why One Million Dollars Is Often Not Enough

A one million dollar liability limit may have been sufficient years ago. Today, it is often quickly exhausted.

Consider:

• Medical costs continue to rise
• Jury awards are increasing
• Legal defense costs alone can exceed hundreds of thousands of dollars
• Florida’s legal environment favors large settlements

Once your primary policy limit is exhausted, the insurance company’s obligation ends. Without umbrella coverage, the roofing company is responsible for the remaining costs.

---

Common Claim Scenarios That Trigger Umbrella Coverage

Umbrella insurance is designed for worst-case scenarios.

Examples include:

• A pedestrian suffers permanent injuries after being struck by falling materials
• A fire caused during roofing work spreads through a multi-unit building
• A roofing truck causes a multi-vehicle accident with serious injuries
• A water intrusion claim leads to mold and widespread property damage

In each scenario, damages can exceed one million dollars.

---

How Umbrella Insurance Protects Business Owners Personally

Many roofing business owners underestimate personal exposure.

If a business is sued for more than its insurance limits:

• Business assets may be seized
• Owners may be personally named in lawsuits
• Personal assets may be at risk depending on business structure

Umbrella insurance provides an additional layer of protection between a catastrophic claim and personal financial loss.

---

Employers’ Liability and Umbrella Coverage

Workers’ compensation policies include employers’ liability limits, typically:

• $100,000 per accident
• $100,000 per employee
• $500,000 policy aggregate

These limits can be quickly exhausted in severe injury cases.

Umbrella policies can sit over employers’ liability, providing additional protection if an injured employee sues outside the workers’ comp system.

---

Umbrella Coverage and Commercial Auto Claims

Auto accidents involving roofing trucks can be severe.

If a company vehicle causes:

• Serious bodily injury
• Multiple injuries
• Fatalities

Auto liability limits may be exhausted quickly.

Umbrella insurance can extend protection beyond auto policy limits, covering additional damages and legal costs.

---

Contract Requirements and Umbrella Insurance

Many commercial clients require higher liability limits.

Common requirements include:

• $2 million or more in total liability limits
• Umbrella coverage for large projects
• Proof of excess liability before work begins

Roofing companies without umbrella coverage may be disqualified from bidding on larger or more profitable jobs.

---

How Much Umbrella Coverage Should Roofers Carry?

There is no one-size-fits-all answer.

Factors to consider include:

• Size of projects
• Type of work performed
• Residential vs commercial focus
• Vehicle fleet size
• Subcontractor use
• Contractual requirements

Many roofing companies carry between:

• $1 million and $5 million in umbrella coverage
• Higher limits for large commercial operations

---

Cost of Umbrella Insurance Compared to Risk

Umbrella insurance is often more affordable than expected.

Relative to the cost of a catastrophic loss, umbrella premiums are typically modest.

This makes umbrella coverage one of the highest-value risk management tools available to roofing companies.

---

Common Misconceptions About Umbrella Insurance

“We’ve Never Had a Large Claim”

Past experience does not predict future losses.

Umbrella insurance exists for low-frequency, high-severity events.

“The Client’s Insurance Will Cover It”

Clients’ policies may exclude contractor-caused losses or pursue subrogation.

“Our Business Is Too Small”

Small companies can face large lawsuits.

Claim size is driven by injury severity, not company size.

---

What Umbrella Insurance Does Not Cover

Umbrella insurance does not cover:

• Intentional acts
• Fraud
• Professional errors unless endorsed
• Contractual liabilities beyond underlying policies

Understanding exclusions is important when structuring coverage.

---

How Umbrella Insurance Fits Into a Complete Program

Umbrella insurance works alongside:

• General liability
• Commercial auto
• Workers’ compensation
• Inland marine
• Builder’s risk

It provides a safety net when other policies reach their limits.

---

Risk Management Still Matters

Umbrella insurance is not a substitute for safety.

Insurance carriers still expect:

• Strong safety practices
• Proper subcontractor management
• Clear contracts
• Documentation and training

Companies with poor risk controls may face higher premiums or difficulty obtaining coverage.

---

Reviewing Umbrella Coverage Annually

As roofing companies grow, umbrella limits should be reviewed.

Growth often means:

• Larger projects
• More vehicles
• Higher payroll
• Increased exposure

Failing to adjust limits can create gaps.

---

Final Thoughts: Umbrella Insurance Is About Survival

Umbrella insurance does not make money for roofing companies.

It protects everything they have built.

When catastrophic claims happen, umbrella coverage can be the difference between surviving and shutting down.