Like most people, you probably have auto and home insurance, but what happens if an accident takes place and your insurance does not cover it? Insurance is used to protect your family and your personal assets, but sometimes it is not enough. That’s when a personal umbrella insurance policy comes into play.
What is Umbrella Insurance?
Umbrella insurance provides an additional number of funds to cover damages that exceed what your normal insurance covers. This can include:
- Property Damage
- Specific scenarios included in the policy
You may feel that your insurance policy covers these situations, but there are possibilities you should consider. What if you have an accident and the other driver files a lawsuit against you? The amount they sue for may exceed what your auto or home insurance policy covers, and there is a possibility that it does not cover lawsuits. In situations like this, a personal umbrella insurance policy can extend your coverage and keep your personal assets safe.
Umbrella insurance can also cover liabilities your standard policy does not, such as: bodily injury liability, property damage liability, rental units, and even slander and libel.
How much coverage does Umbrella Insurance provide?
The majority of personal umbrella insurance policies provide anywhere from one to five million dollars of coverage. The amount they provide varies based on the plan you choose. You may wonder how an insurance policy that provides so much protection can be affordable, but you must keep in mind that these policies are for worst-case scenario coverage. When you purchase an umbrella insurance policy, it is with the hopes that you never need to use it.
What is does an Umbrella Insurance policy cost?
Personal umbrella insurance policy premiums may range anywhere from $150 to $300 per year for around $1 million in coverage. Every additional million will add on another $50 to $75 per year.
Do I need a Personal Umbrella Insurance policy?
While this is not a type of insurance many people have, there is a simple way to figure out whether purchasing it is a smart decision for you. The more you have, the more protection you need.
If you have a large amount of personal assets, whether solid or liquid, you will need more protection. Real estate, vehicles, valuable collections, and more can all be subject to seizure in the event of a lawsuit. You may need to liquidate these assets to find funds for costly medical bills. A personal umbrella insurance policy can eliminate the need to do this and save you from the mental anguish.
If you are in possession of a large number of assets or you simply want to ensure your family is protected, consider purchasing an umbrella insurance policy. It can provide protection that extends beyond what your normal policies cover.