What is umbrella insurance?
You never know when it might rain. So, just like the name implies, this type of policy acts like an umbrella, providing protection against a wide range of potential financial dangers and unforeseeable mishaps.
Umbrella insurance does not cover:
- Your own medical expenses
- Losses to your property
However, what exactly is covered by your umbrella policy depends on how you decide to set it up. In most cases, umbrella insurance protects you from:
- Injuries you cause in a car accident
- Injuries someone suffers on your property
- Property damage you cause in an accident
- Property damage your pet causes
- Property damage a dependent or child causes
- Attorney fees and other legal costs
Yes, your existing insurance may protect you to an extent, but an umbrella policy goes much further for less cost than upping the limits on your existing policy because it covers for different types of risks. Umbrella insurance is also portable, in most cases, so it can follow you when and wherever you travel.
Since the terms of umbrella insurance policies will vary, depending on insurance companies and your own personal needs, a qualified insurance agent from our firm is the best person with whom to discuss the benefits, restrictions, and coverage from each carrier they represent.
Aren’t people with a lot of assets the only ones who need umbrella insurance?
Actually, anyone with a job, who expects to keep the income they earn, could benefit from having an umbrella insurance policy.
What would happen, for example, if someone made a delivery to your house, slipped on a sidewalk recently wet by your sprinkler system, and suffered severe head injuries from the fall. They will sue you, of course.
Your homeowners insurance kicks in and pays up to its maximum limits. But the jury finds that you are responsible for an extra $500,000 over your homeowner’s limits.
Ask yourself: How long would it take you to pay that off with your weekly paycheck?
Umbrella insurance covers the amount that exceeds your homeowners coverage, usually up to $5 million, sparing you from a financial nightmare, along with paying the attorney to help you survive it.
Are umbrella policies expensive?
Relative to the amount of protection you get, umbrella insurance is highly affordable. Especially since it’s unlikely you will ever have to make a claim against it. So, your specific cost will be determined by:
- The amount of coverage you purchase
- Your insurance carrier’s provisions
- Your risk profile and driving record
You may save even more money by purchasing umbrella insurance from the same carrier who provides your home and/or auto insurance-check with us to make sure.