What is umbrella insurance?
An umbrella policy adds liability coverage above the limits of your auto and home policies, usually in increments of $1 million. If a covered claim runs past what your underlying policies will pay, the umbrella picks up the rest, up to its own limit. It also covers some claims your standard policies may not, depending on the policy. It does not cover your own property or injuries. It is liability protection, scaled up.
Who should consider an umbrella policy?
Anyone with assets worth more than their current liability limits should look at it. That commonly includes homeowners, families with teen drivers, owners of rental property, and households with features that raise liability exposure, such as a pool or a trampoline. A single serious lawsuit, after an accident with injuries for example, can exceed standard auto and home limits and reach your savings, your home equity, and even future income. An umbrella policy is the layer that keeps a claim from becoming a personal financial event.
How much does umbrella insurance cost?
Umbrella coverage is usually inexpensive relative to the protection it provides. A $1 million policy often costs a few hundred dollars a year, though the actual rate depends on your underlying policies, your household, and the carrier. We will give you a real number for your situation, not a guess.