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Umbrella

Umbrella Insurance

It seems like every time we turn around, were being told we need some type of insurance. We may not like the idea of paying premiums on insurance we may never need, but we still understand the need to carry insurance. Even more important than having insurance is having the right kind and having enough. Learn what umbrella coverage is and if its something worth looking into.

What is Umbrella Insurance?

Just as an umbrella provides additional coverage from the rain, umbrella coverage provides additional protection above and beyond your original policy amount. Its not a policy that can be purchased on its own. You must first purchase an insurance policy for a designated amount. If you feel that amount may not be sufficient, you can pay for an umbrella policy.

Who is Umbrella Coverage For?

Umbrella insurance is for anyone that feels they may be victims of a lawsuit and wont have enough insurance coverage from their basic policy. Individuals may carry an umbrella policy to supplement their homeowners or automobile insurance policies, but umbrella policies are generally used by business owners.

How Umbrella Coverage Works

As stated above, umbrella coverage provides additional coverage. Its not a policy on its own. For instance, you have $250,000 in liability coverage on your home insurance policy and $1,000,000 on an umbrella policy. A neighbor falls on your property and sues you for $500,000. Since you only have $250,000 on your home policy, thats all that can be paid from that policy. Here is where the umbrella coverage is beneficial. The umbrella policy will take care of the additional $250,000 still due on the law suit.

Different Types of Coverage in Existence

Umbrella policies can provide coverage against property damage, personal injuries, some lawsuits and additional personal liability situations.

  • Bodily injury liability
  • Property damage liability
  • Liability coverage for owners and landlords of rental units
  • Coverage against slander, libel, false arrest or malicious prosecution

Major Benefits of Umbrella Coverage

Umbrella coverage is beneficial because it provides you with monetary protection above and beyond what your original policy covers. However, in addition to ensuring that you are covered for a higher amount, umbrella policies can also provide coverage against incidents that may not be covered in a basic insurance policy.