Insurance Matters

The truth about Personal Umbrellas...

Umbrella Policies are usually from one to five million dollars in coverage. Some companies will allow higher limits with underwriting approval. This is a policy that protects your assets if you are sued for negligence. They are called umbrella policies because they go over your home, auto, motorcycle, boat, RV and any other personal insurance policies. If you get an umbrella they will usually require higher liability limits on your underlying or existing policies. Most financial planners will recommend you to have an Umbrella policy. These policies are relatively inexpensive for the coverage obtained.

How do you determine how much coverage you need? An estimate would be to add up your assets, such as: savings accounts, automobiles, houses, retirement accounts, etc. Make sure you have enough coverage to protect your assets; if you have $800k then you will need one-million.

Benefits:

Any person who has assets or the potential to aquire substantial assets could benefit from an umbrella policy. If a person wins civil damages in a lawsuit against you, your assets could be at risk. An umbrella policy would pay the civil damages and protect your assets, allowing you to keep them.

Misconceptions:

Many people think that only rich people need to get an umbrella insurance policy. This is not true. If you own assets, then you could benefit from an umbrella policy. Remember that your assets can be taken away from you in a law suit and your wages garnished.

Another common misconception is that honest people do not need an umbrella insurance policy. This is also not true. Even a honest person can get sued. Accidents happen in life and unfortunately cannot always be avoided. A person can fall off the steps of your home or you can get into a car accident and injure a person. Either of these injuries can cause damages to the person that exceeds the coverage of your homeowners or automobile policies. An umbrella policy would pay the excess financial damages.

Professional Insight:

We can help you to determine the amount of umbrella insurance coverage that you should purchase. Personal net worth is just one factor to consider. We will help you to predict the possible financial risks that you face in your life. For example: People with certain jobs face a greater chance of lawsuit being brought against them. If you do not have enough coverage, your assets could be left vulnerable.  A little bit of foresight to purchase an umbrella insurance policy can save your assets in the future.