Lawsuits can happen, and when your auto or homeowners insurance coverage is exhausted, this is when an umbrella insurance policy can help. The additional layer of liability coverage can help to reduce the exposure to your personal assets in the event of a covered claim. If your net worth exceeds your maximum liability coverages, then an umbrella policy may be well worth your investment.
Everyone should consider including an umbrella policy as part of their overall insurance program, as it can be an important tool to help mitigate your risks and protect your assets. Additionally, you should be sure to discuss umbrella coverage with your insurance agent if:
You are a public figure
You have domestic employees
You regularly host parties at your home
You or your spouse serve on a school or charitable board
You have dogs or other animals
You have a swimming pool
An umbrella policy, also known as an excess liability policy, is an insurance coverage that helps to cover certain losses that exceed the liability limits of your underlying homeowner or automobile insurance. In other words, a personal umbrella policy can serve as an additional layer of liability protection (subject, of course, to policy limits, terms and conditions) against claims that exhaust your homeowners or automobile liability insurance limits.
Just like any other insurance coverage, the price of umbrella insurance can vary depending on a variety of factors. Among others, some factors that may impact price include:
An umbrella policy can help protect you and your assets if a covered liability claim is made against you, and the claim exceeds the liability limits of your other underlying policies. Typically, in order to qualify for an umbrella policy, you will need to maintain certain minimum levels of liability coverage on your homeowners and automobile insurance policies.
The following are some basic examples of how an umbrella policy may work to help protect you and your assets.
If you are at fault for an automobile accident resulting in bodily injury and/or personal property damage, and your automobile insurance liability limits are exhausted, your umbrella policy can kick in to provide additional liability coverage for the claim up to the umbrella policy’s limits.
If someone is injured while on your property, you may be held responsible for their medical bills, pain and suffering, etc. If the value of the claim exceeds your homeowners’ liability coverage limits, an umbrella policy can help to provide additional liability coverage for the claim up to the umbrella policy’s limits.
Cross Private Client Insurance now represents the top personal lines partners in the market.
