Do I Really Need an Umbrella Insurance Policy? Here Are Some Things to Consider.

Standard auto and homeowners insurance policies cover liability for bodily injury or property damage for which you are negligent.  And while limits of $100,000 to $250,000 may cover you for most accidents, there are cases where those limits aren’t enough.   If you have personal assets above those limits you may be jeopardizing those assets.

To cover financially devastating events, insurance companies offer personal umbrella policies. Umbrellas provide additional protection when an accident exhausts the limits provided by other policies. They may also cover some types of losses these other policies do not cover.

To determine if an umbrella policy is right for you, you should consider the following questions:

First, do you have items that put you at a higher risk for a catastrophic loss? For example, do you have multiple cars or inexperienced drivers in your household?  Household attractions like swimming pools, trampolines, and swing-sets present an exposure to severe losses.

Next, do you have any risks that don’t involve potential physical injury or property damage that might require different coverage? For example, do you or any members of your family participate in social media websites or online discussion forums? Does anyone coach a youth sports team, belong to the governing board of a non-profit organization, write computer code as a hobby, or give music lessons? These activities present different exposures to legal liability.

Third, do your underlying policies have high enough limits? How high are the liability limits on your homeowners and auto insurance policies?  Does your homeowners insurance cover any business activities?

If you positively answered any of the questions above, then you may want to consider umbrella insurance.  Please contact our office to find out more.