While it can be odd to talk about umbrellas as we approach summer in Texas, when it comes to protecting your family and your assets, an umbrella insurance policy might be just what you need.
Umbrella insurance, which is also known as liability insurance, goes above and beyond other insurance policies you may have. Umbrella insurance policies typically come into play when the maximum amount has been paid out by primary insurance policies, ensuring that your personal assets have added protection when such circumstances arise. Personal umbrella insurance policies are most commonly supplement homeowner or automobile insurance. Some umbrella policies also cover claims that are not included in other liability policies, like slander, false arrest, defamation of character, and libel.
Imagine that you get in a car accident and you are deemed responsible. The other driver in the accident is injured, requires extensive medical care, and suffers loss of income from not being able to perform his job for a year. You are sued for $2 million, but your car insurance policy may have maximum payout of only $300,000. With umbrella coverage, rather than have to pay the remaining amount ($1.7 million) from your personal assets, you would then be covered for anywhere from $1 million up to $5 million (typically in million dollar increments), depending on your policy. Often, personal umbrella insurance policies may also cover your legal fees.
Umbrella policies can also provide extra protection when you are traveling abroad or someone gets hurt in your home. Once your primary insurance policy pays the maximum amount, you will be personally liable for the difference between the insurance payout and the amount you are being sued for. With an umbrella insurance policy, your home, bank accounts, retirement accounts, and other valuable personal assets can be protected.
Personal umbrella insurance policies with $1 million coverage can typically be purchased for anywhere from $100 to $300 a year depending on your state and your personal qualifications.
Contact us today to learn more about umbrella insurance policies and whether personal liability might be right for you.