Umbrella Insurance provides additional coverage beyond what is offered by your homeowners, auto, or boat insurance policies. It can help protect your assets, such as your home, car, and savings, in the event that you are sued for a large amount of money.
Typically covers the following:
- Personal liability: This covers claims for injuries or property damage that you cause to others.
- Medical payments: This covers the medical expenses of others who are injured in an accident caused by you.
- Legal defense: This covers the cost of your legal defense if you are sued.
- Loss of income: This covers your lost income if you are unable to work due to an accident caused by you.
- Rental property liability: This covers claims for injuries or property damage that you cause to others while renting out your property.
Umbrella insurance is not a one-size-fits-all product. The amount of coverage you need will depend on your assets, your lifestyle, and your risk tolerance. A good rule of thumb is to get an umbrella policy with a limit that is equal to the combined limits of your homeowners and auto insurance policies.
Here are some of the benefits:
- It can protect your assets from large liability claims.
- It can help you avoid bankruptcy if you are sued for a large amount of money.
- It can provide peace of mind knowing that you are financially protected in the event of an accident.
If you have significant assets, own a home, or drive a car, umbrella insurance is a good way to protect yourself from the financial consequences of a liability lawsuit. Talk to your insurance agent to learn more about umbrella insurance and whether it is right for you.
Here are some additional things to keep in mind:
- It is typically sold as a standalone policy, but it can also be added to your homeowners or auto insurance policy.
- The cost of umbrella insurance is relatively low, especially when compared to the amount of coverage it provides.
- You can usually get umbrella insurance with a deductible, which will lower your premiums.
- Umbrella insurance is not required by law, but it is a wise investment for many people.
If you are considering getting umbrella insurance, I recommend that you get quotes from several different insurance companies. You should also make sure that you understand the terms and conditions of the policy before you purchase it.