When you own a business, you have different insurance needs that depend on the type of business you do and on where you conduct your business. If you do business in countries outside of the United States, you most likely need foreign liability insurance coverage in case of any accidents that might occur in a foreign country in which you conduct business. Most standard U.S. business liability policies do not cover accidents that take place in another country. Our agents at Elite Insurance Solutions can help you decide if this type of insurance is necessary for your business. We would like to tell you more about foreign liability insurance by sharing with you some information from About Money.
Why would I need foreign liability insurance?
You should consider purchasing foreign liability coverage if your business exports products to foreign countries and if your business includes a store, warehouse, or other physical location in a foreign country. Frequent business travel to foreign countries would be another reason to hold a foreign liability insurance policy.
What exactly is covered in a standard U.S. business liability policy?
This policy typically covers property damage and bodily injury caused by something that happens in the coverage territory, which is generally the United States, Puerto Rico, and Canada. Other situations that are covered under a standard U.S. liability policy include injury or damage that arises from temporary business travel in a foreign country by you or another insured and from products that you distribute outside of the United States if they are made or sold by you in the U.S.A., Puerto Rico, or Canada.
What are the different types of foreign liability insurance?
Foreign liability insurance includes two different types of policies: exporters package and controlled master program.
EXPORTERS PACKAGE
Designed for companies whose foreign business dealings are made up of U.S. products exported outside of the United States, the exporters package policy does not include physical locations, such as a store or a warehouse, in foreign countries. Covering product liability lawsuits for bodily injury or property damage that happens outside of the U.S., this type of policy can also cover incidental foreign travel and can be bundled with auto liability and personal property coverage.
CONTROLLED MASTER PROGRAM
If your business includes stores, warehouses, or other physical locations in a foreign country, you will need a controlled master program (CMP). This type of policy includes a master policy, which is written by an American insurer on a U.S. policy form, and one or more local policies, which are issued by an insurer located in the country where the physical location exists. When you have a CMP, the master policy applies on an excess basis and a difference-in-conditions over the local policies to ensure you are completely covered.
Does your company conduct business in foreign countries? Contact Elite Insurance Solutions to learn more about foreign liability insurance and how our agents can protect your business outside of the United States.