At some point or another, almost everyone who has shopped their insurance has been asked if they would like an umbrella policy. The large majority of customers or prospects that we talk to over the course of a day have no idea what a personal umbrella policy does or the coverage it provides. However, as is the case with many of the prospects and clients we speak with, many insured’s are not taking proper measures to protect themselves and their assets.
First things first – what is a personal umbrella policy? A personal umbrella policy provides an additional amount of liability – usually starting at $1 million – over and above what your current policies provide. That’s right; these umbrella policies usually extend over the underlying liability limits of your other personal insurance policies – some which may include: homeowners, autos, motorcycles, boats, rental dwellings, recreational vehicles, etc.
The first rejection that is common among our customer base is: “Why would I need $1 million of liability coverage!?” Many of us have much more liability exposure than we realize. For a quick 15 question quiz to determine your liability exposure, visit www.whatsmyliability.com . In addition to paying any damages that you may be liable for (injury, damage to property, pain and suffering, lost wages, etc.), an insurance company will also pay for to defend you in a court of law!
Secondly, a true umbrella policy will also provide coverage that may not be available in the underlying coverage. Normally, the insured must pay a type of deductible called a self-insured retention before this coverage will apply.
Umbrella policies are usually very affordable, especially when packaged with existing policies. You may be eligible to apply discounts to your existing policies when an umbrella policy is written as well! Most importantly, umbrella policies protect you, your family, assets, and future income!
As always, contact your local agent if you have any questions and read the policy form for exact coverage. Usually, the underlying coverage must be maintained during the policy period in order for coverage under an umbrella policy will apply