Archive for the ‘Umbrella Insurance’ Category
Umbrella insurance is a lesser known type of insurance, but one that is just as important. On top of homeowners and auto insurance, umbrella insurance provides additional protection above the limits offered by the former and also offers broader protection as well.
There are a few, not uncommon scenarios in which umbrella coverage would be extremely beneficial. If a neighbor slips on the driveway and sues, umbrella insurance would cover that. If there is a car accident, umbrella insurance would cover that. In an age where more and more are turning to the courts, accidents can become very expensive quickly and umbrella insurance is one defense against that. Most auto and homeowners insurance policies have a limit on the amount covered in the hundreds of thousands, but umbrella insurance has a much higher limit.
Umbrella insurance is typically sold in increments of $1 million and costs around a few hundred to a few thousand per year. While $1 million may seem like a lot, assets quickly add up and many will find that they have more to protect than they first realized. However, this policy is not for everyone and an easy way to determine whether it is or not is by subtracting assets from liability coverage. If the current insurance policies cover assets sufficiently, adding a new policy may not be necessary. If the policies do not fully cover assets, then umbrella insurance is one way to fill up the gap.
Of course, umbrella insurance covers more than just the current assets. In the case of a judge awarding damages of millions to the other party, the true worth of umbrella insurance shows. For only a few hundred to a few thousand per year, one can rest easy in knowing that their assets are fully covered.