You want to take into consideration not only your personal assets but also your potential personal risks. Determine your personal risks to evaluate the amount of additional liability coverage that makes the most sense for you. Coverages start at $1 million and can go as high as $10 million.
Umbrella insurance companies generally have minimum requirements of how much liability coverage you MUST have on your primary automobile or homeowners policy. Most companies require you to have $300,000 liability coverage on any homes and automobile bodily injury coverage that is either $100,000/$300,000 split limits or $300,000 combined single limit. Anything less, the umbrella company will require you to raise your limits before they offer you the coverage.
Some Umbrella companies offer extended coverage for uninsured/underinsured motorists' coverage, which will offer you even more protection for yourself should you get injured and the other driver has minimal coverage.
Additional liability insurance is inexpensive when compared to the added coverage you gain. Depending on the policy value and your personal risk factors, such as recent auto tickets, your credit rating and more, a $1 million umbrella typically costs less than $300 annually. Premiums go up an additional $50 to $75 for each million thereafter. Discounts are generally available as well when you purchase an umbrella policy with the same company as your auto or home.
Accidents happen - and it's not uncommon for jury awards and out of court settlements to run into millions of dollars. While it's difficult to pinpoint the monetary consequences of the risks you and your family take each day, are you certain your current liability insurance offers you enough protection?
If you are found to be legally responsible for injuring someone or damaging their property, without a personal umbrella policy, anything beyond the limits of your standard liability insurance coverage will come out of your own pocket. If you had a policy, the insurance company assumes the risk, not you.
Not only do they cover the judgements in a lawsuit, but in most cases, they will provide you with legal defense. If the company provides the legal defense, the cost will not be deducted from your liability limit. It's almost like you have a personal lawyer on retainer!
After a hectic work week, Jim Marshall was looking forward to a relaxing weekend with his wife and kids. He was just a few blocks from home when his cellphone rang. He glanced down to see who was calling. That split-second distraction was all it took for him to miss the approaching stop sign.
Jim plowed into the side of a passing car. The accident resulted in serious injuries to the driver and passenger of the other vehicle. Jim was sued, found at fault and ordered to pay $1 million for medical expenses, lost wages and the "pain and suffering" of the injured parties.
Although he had auto insurance, that policy had a limit of $300,000. That meant that unless Jim had another way to pay the remaining $700,000, his assets (retirement savings and college funds for his teenage sons) were at risk of being garnished. Fortunately, Jim was able to keep his assets because he had a personal umbrella liability insurance policy to cover the remaining balance.
Don't wait for a rainy day to find out you need the additional protection a personal umbrella liability policy can provide. Contact us today to discuss your unique needs and we will be happy to provide you with an accurate quote.