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You don’t have to be a millionaire to need umbrella coverage

When liability insurance is mentioned, most people think of auto or homeowners insurance. Both cover your defense costs along with your liability up to your policy limits if somebody else is injured as a result of your negligence.

Why do I need umbrella insurance?

Your insurer is only exposed up to the extent of your policy limits. If a $1 million judgment is taken against you, and your policy limit is $300,000, you’re personally on the hook for the balance, and the injured party can collect from your personal assets. That’s what umbrella insurance is for. It’s additional liability insurance that protects you against large claims and lawsuits. Umbrella insurance coverage starts when your primary policy limits are exceeded.

What are the other risks that umbrella insurance covers?

Along with bodily injury liability, umbrella insurance coverage ordinarily includes property damage, damages from libel or slander, invasion of privacy, false arrest and other civil causes of action.

Who is covered by my umbrella policy?

Your umbrella policy doesn’t only insure you. It insures your spouse and any residents of your household, too. Your policy defines who is covered as a resident of your household. If your teen who lives with you swerves your car to avoid an animal in the road and strikes a bicyclist, your umbrella coverage is triggered when your primary liability coverage ends.

Who needs an umbrella policy?

You don’t have to be a millionaire to need umbrella coverage. The maximum liability insurance that most auto or homeowners insurers will issue is $300,000 per person. That leaves you exposed for another $300,000 on a $600,000 judgment. Now consider the cost of umbrella insurance coverage.

It’s surprisingly inexpensive!

For your first $1 million of umbrella insurance, you’re looking at somewhere around a dollar a day or even less for your annual premium. After that, it’s about $100 per year for each additional $1 million.

You can’t beat that kind of coverage at those prices, and the more assets that you accumulate, the more you’ll want the coverage. Contact us for a free evaluation and umbrella insurance quote. You’ll be surprised at how affordable umbrella coverage is.