Maybe. Depending on your carrier’s policy form, corporations that are wholly owned by the first named insured may have coverage automatically extended. However, any corporations with multiple owners or shareholders are not included in this definition and entity liability coverage is not in place unless specifically named. In situations where entity coverage is automatically included, we always recommend providing the name of your entity and any DBAs to the insurer for their file.

No, entity liability coverage is available whether your business is an LLC, corporation, or partnership, and L&J can help in each of these scenarios.

Shared limits entity coverage is an option with most carriers, but it comes down to personal comfort level. In the event of a claim, you’d all pull from the same pool. It’s typically cheaper and easier to add entities and ancillary providers this way, but that’s because you’re taking on some of the risk. A serious claim involving an entity and, potentially, multiple providers can get expensive quickly. As such, your communal funds can dry up fast leaving those sharing the limits on the hook for any remaining balance after the limits have been exhausted.

You want your entity liability insurance limits to be the same as those on your personal policy. Carriers typically won’t allow for mismatched limits on the same policy without good reason, but you’ll want to make note of this if you and your entity are covered under separate policies. You don’t want either yourself or the entity to be the “deep pocket” and be targeted unevenly to pay out in the event of indemnity or settlement.