Excess Auto Liability
An excess liability policy that sits specifically above a commercial auto primary policy, providing additional limits for auto-related claims.
What It Is
Excess Auto Liability is excess coverage that sits above a commercial auto primary policy to provide additional liability limits for bodily injury and property damage claims arising from auto accidents. This coverage is critical for trucking companies, delivery fleets, and any business with significant auto liability exposure.
Excess auto liability may be provided through a commercial umbrella policy (which typically sits over CGL, auto, and employers liability) or through a standalone excess auto policy. For high-risk auto classes like long-haul trucking, standalone excess auto coverage is often necessary because umbrella carriers may decline to include auto in the covered underlying.
The excess auto policy follows the terms of the underlying auto policy and responds once the primary limits are exhausted.
Why It Matters for Brokers
Auto liability claims have experienced significant severity trends, with nuclear verdicts in trucking cases regularly exceeding $10M and sometimes surpassing $100M. Primary auto limits of $1M are frequently inadequate for serious accident claims. Brokers must evaluate each auto account's excess liability needs based on fleet size, vehicle types, operating radius, and the current claims environment. Failing to recommend adequate excess auto limits is an increasingly common E&O exposure.
Real-World Example
A regional trucking company with 40 power units carries $1M CSL primary auto and needs additional limits. The standard umbrella carrier declines auto coverage due to the fleet size and operating radius. The broker places a standalone $5M excess auto policy with a specialty trucking carrier, then adds a $5M second excess layer, creating a $11M total auto liability tower ($1M primary + $5M first excess + $5M second excess).
Common Mistakes
- 1Assuming the standard umbrella automatically covers auto liability when many umbrella carriers exclude or sublimit auto for higher-risk fleets.
- 2Not recommending adequate excess auto limits in light of current nuclear verdict trends in commercial auto cases.
- 3Failing to maintain the required underlying primary auto limits, which can void the excess coverage.
How brokerageaudit.com Handles This
Policy Checker verifies that commercial auto accounts have adequate excess coverage by comparing underlying limits, fleet size, and operating characteristics against current claims severity benchmarks.