A personal umbrella policy provides you with coverage in the case of large liability claims or serious judgments with financial penalties. This type of insurance takes effect when you have reached the liability limits of other policies like homeowners or auto insurance.
Having a personal umbrella insurance policy goes further to protect you in the liability claims relating to legal issues like slander or false imprisonment.
In this quick guide, we’ll tell you everything you need to know about personal umbrella insurance and whether it’s the right policy for you:
When Is Personal Umbrella Insurance Used?
Let’s go through a couple of examples of how personal umbrella insurance can help you.
Say you have a dog that you keep in your home and yard only, and that one day it managed to escape into the road and bite a small child. That child’s parents could then sue you for the cost of their medical bills.
Now your general home insurance policy isn’t likely to cover this type of situation - this is where personal umbrella insurance comes into play. It covers you as the policyholder, and can additionally cover your immediate family members. So if you have a teen that is learning to drive, this policy extends to cover them above and beyond general auto insurance.
Other important things that are covered by a personal umbrella insurance policy include:
-Bodily injury or personal injury
-Property damage
-Rental or landlord liability
Although this type of insurance policy has a wide range of applications, there are a few things that may not be covered. These typically include:
-Personal belongings (so yes, buy that additional cell phone insurance!)
-Business losses, written or oral business agreements, and contracts
-Purposeful criminal acts or omissions of criminal history
Do I Need Personal Umbrella Insurance?
It can be difficult to think about the need for personal umbrella insurance - after all, no one wants to imagine bad things happening to themselves or their family members. On the other hand, umbrella insurance is the type of coverage that can help you rest easier at night knowing that you have an additional layer of protection.
Almost anyone can benefit from having a personal umbrella insurance policy. Accidents can happen to anyone, and you never want to be in a position where you need to pay for another person’s medical or legal costs out of pocket if you’re found to be liable.
So how can you tell if it’s the right thing for you right now? Well, the general rule of thumb is that if all of your assets including your bank accounts, investments, and home equity are greater than the limits of your auto or homeowners insurance policies then you’ll most likely need a personal umbrella policy as well. You are basically taking an additional policy that kicks in as soon as you reach the cap of the others - ensuring that your assets cannot be lost in lawsuits.
At the same time, it’s important to bear in mind that a jury can award damages that can exceed even your personal umbrella policy’s limits. If you’re engaged in an activity that puts you at a higher risk of liability lawsuits, it’s still worthwhile to invest in a personal umbrella policy.
What Does A Personal Umbrella Insurance Policy Cost?
The cost of your umbrella policy will depend on a few different factors. First, how much coverage you need will play a part, and then the state that you live in will also have an impact on how much you pay.
There may be an additional cost based on how much risk you present to the insurance company. For example, the more assets and household members you have on your policy, the higher the cost is likely to be.
Richard Dean Insurance is more than your average insurance agency. Based in both Lakewood Ranch and now in Sarasota, we’re committed to providing the best insurance coverage possible to individuals and families in the greater Florida area. We pride ourselves on making the insurance process easy, no-fuss, and offering great prices. Our customer service team is pretty darn cute too!
Sleep easier at night. Contact us today to learn more about personal umbrella insurance and to find your best policy fit.