What is an Umbrella Insurance Policy

Umbrella Insurance

Accidents happen, and almost as frequently these days, so do lawsuits. The average settlement award has skyrocketed over the past decade and there is a chance that your automobile or homeowner’s coverage won’t provide enough coverage to adequately protect your assets.

That is where an Umbrella policy comes into play. An Umbrella policy will give you an extra layer of Liability coverage that protects your assets against a liability lawsuit involving your auto, home, recreational vehicle or rental property that is owned in your personal name and is a 1-4 family dwelling.

Why do I need an Umbrella Policy

Umbrella policies in today’s day in age are a must. We live in a litigious society and in the event of a major accident or incident that happens you want to make sure you have enough liability protection to protect your assets.

One of the areas that we see Umbrella Insurance come into play is for excess Property Damage accidents. Personal Umbrella Policies come into play for not only injuries but also major property damage accidents.

Examples of these might be a large car pile up on the highway or sliding off the road into a house or commercial building. A typical property damage limit on your personal auto policy could be $100,000. With repair costs what they are, you could easily exhaust that limit in a major accident.

What is at risk

No matter what age you are or how financially well off you may be, everyone should have a personal umbrella policy especially if you own a home.

Outside of tangible assets, one of the main things that especially young adults need to worry about is the risk to your future earnings.

All of the following could be in jeopardy if you do not have enough coverage to cover the accident that occurs.

  • Checking & Savings Accounts
  • House and Personal Property
  • Retirement accounts
  • Future Earnings

YouTube video

Commercial Umbrella Insurance

This video and article are focused mainly on a personal umbrella policy but it works the same way for a business owner and their insurance policies.

Business Owners can get a commercial umbrella policy to protect over the top of all business insurance policies that they may have in the specific entity. One thing to note, if you have multiple business entities, you may need to take out multiple umbrella policies.

Each business is different and will depend on the options available.

What’s Next?

Having the right insurance is important. The reason you pay for insurance is to protect your assets in the event a claim or accident occurs. Without the right coverage, you are wasting the money you are spending and taking a high risk.

Everyone and every business is different. Working with an independent insurance agent will help you get the right coverage for your specific needs.

If you don’t have a relationship with an agent or want a review of your insurance?

Click below to learn more about how to proceed.



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