Umbrella Insurance - What Is It & Why Do I Need It?

Most people have insurance to protect their most important assets (your home, your vehicles, etc.) but do you have enough coverage to protect yourself from a catastrophic liability claim (a lawsuit)?

Umbrella policies provide you with an additional layer of liability protection over the limits provided by your home, auto, or business insurance. A single claim could hit you harder than you may expect. Owning a swimming pool, trampoline, dog or even having an inexperienced driver in your household could put you at a higher risk. Why? Because all these things not only increase the possibility a claim could occur they also increase the severity and expense of the claim when it does.

Accidents happen every day. For example - A driver in a rush on their way to work or late to pick up a child weaves around slower traffic and quickly switches lanes. Not realizing there was a vehicle in their blind spot they collide with the other vehicle causing severe damage to the car and breaking the hand of the other party involved who is a surgeon and now cannot work due to their injuries. The driver is held liable (financially responsible) and is required to not only pay the medical bills and vehicle repairs but also the lost wages (current and future) and pain and suffering of the injured individual. When you consider the most coverage the average person carries on their auto policy is between $50,000 to $100,000 this would easily exceed their auto insurance liability limits. So where does the money come from to pay the rest of the judgment? If you don’t have an umbrella then you guessed it. Out of your pocket!

An umbrella policy would also protect you from someone being injured on your property. For example - A guest at your Childs pool party dives unknowingly into the shallow end of your pool and suffers severe injuries. You are sued and held responsible. Only having $300,000 in liability coverage afforded under homeowners insurance may not be enough for legal representation and the settlement. You want to take a guess where the money comes from after the insurance runs out? Without an umbrella you guessed right again. Out of your pocket!

Having this additional liability coverage could protect you from life’s unexpected accidents. The peace of mind knowing you are protected is well worth the inexpensive premiums of umbrella insurance. Typically umbrella policies cost as little as $125 to $200 a year at most. Contact an agent today to discuss your risk and how affordable it is to have this valuable protection.