Why Do You Need Umbrella Insurance?

What is Umbrella Insurance?

If you own a home, car or boat, you’re likely to have primary insurance policies that provide liability coverage for each of these assets. However, your primary policy limits may not be enough to cover all claims, which can cause unexpected financial hardship. That’s where umbrella insurance comes in.

Umbrella liability insurance is designed to further protect against the costs of:

  • Claims made against you for bodily injury to others due to a car accident, boat incident, fall or other covered accidents.
  • Claims made against you for covered damage to others’ property.
  • Personal liability for claims like libel, slander, defamation of character and invasion of privacy.
  • Potential out-of-pocket expenses related to each of these (or other) covered incidents.

Additionally, with increasing dollar amounts awarded by juries in personal auto liability cases—driven partially by social inflation—it’s essential to safeguard your income and assets.

Who Should Get Umbrella Insurance?

Anyone who has assets that they want to protect should consider purchasing umbrella insurance. Here are some examples to think about:

  • At-Home Dangers – Trampolines and swimming pools could potentially lead to serious injuries and liability claims.
  • Slip and Fall Claims – Someone could slip and fall—and suffer an injury—on your property. This can apply to your primary residence or if you’re a landlord of one or more additional properties.
  • Family Matters – Imagine your liability if your teenager causes a major car accidents.

These are just a few examples of the risks that might make umbrella insurance right for you.  Another important reason to consider purchasing umbrella insurance is peace of mind.  In life, mistakes and accidents happen. Someone, including friends or visiting loved ones, could become seriously injured on your property or when you’re driving.

When something like this occurs, you’ll know that you took extra steps to help cover the damages in the event you’re responsible for the loss.

How Much Does Umbrella Insurance Cost?

Typically, umbrella coverage is considered very affordable. Your final cost will depend on variables specific to your situation. $1,000,000 in umbrella coverage could start as low as $20/month.

Is an Umbrella Policy Worth It?

If you’re thinking about adding umbrella coverage, consider this: you hope you’ll never have to use it, but if you do, you’ll be grateful it’s there. Umbrella coverage is designed to take effect once the liability limits of your homeowners, auto, or boat policies have been exceeded. It’s an economical way to safeguard your assets now to help avoid the possibility of significant financial hardship later.