In the third installment of our blog series on insurance policy reviews, we invite you to take a look at your current coverage. Are there any gaps? It might be the time to consider personal umbrella insurance.
Accidents happen. And lawsuits sometimes follow. Judgments amounting to thousands or even millions are being awarded by juries across the country in ever-increasing numbers. If you accidentally injure someone or damage their property, you could be the one sued. Even though your underlying auto and homeowners policies may provide substantial liability limits, it is not uncommon today for juries to award damages that exceed those limits. Or what if someone sues you for a claim not covered by your other policies? That’s where a personal umbrella policy (PUP) can help. Coverage amounts are written in increments of $1 million and supplement your present policies to provide additional personal liability protection.
Why is Personal Liability Insurance So Important? With a personal liability insurance policy, you’re protected from the risk of being held responsible for damages and injuries to others. If you’re found legally liable, you’re covered for any legal payouts (up to the primary liability policy limits) or legal costs associated with the lawsuit. If you don’t have this coverage, any legal fees and damages would have to be paid for out of pocket.
A Personal Umbrella Policy Can Give You Peace of Mind A second layer of liability coverage, a personal umbrella policy sits on top of your personal policies’ liability coverages. If you end up getting sued for an amount that’s more than the primary liability covered on your personal home, auto or other (think rental property, boat, motorcycle, ATV) policy, you could have to pay out of pocket for the amount that exceeds your primary limit of liability.
Personal Umbrella insurance Covers More Than You May Think
- You (as the insured) and any of your resident relatives
- Gaps in your primary policy coverage such as protection for personal injury liability for wrongful entry, false arrests, invasion of privacy, slander, defamation, libel and humiliation
- Legal payouts against you when your underlying liability insurance limits are exceeded by a covered lawsuit
- Legal costs and expenses are covered by the insurance company and are typically covered outside your policy limits
Typical Size and Coverage Amounts for a PUP For qualified applicants, a personal umbrella policy’s coverage limits start at $1 million and go up in million-dollar increments. When determining your PUP coverage, take into account that your assets also include your future earnings, home and other property, business interests and valuables.
A Personal Umbrella Policy Applies Worldwide No matter where you go
in the U.S. or around the world, your PUP coverage goes with you.
A PUP is Affordable Depending where you live, a personal umbrella insurance policy can cost you as little as $1 a day, and sometimes even less. Best of all, the additional protection can work with any existing personal liability insurance coverage.
You Must Meet the Minimum Underlying Limits on Your Primary Personal Policies In order to retain a personal umbrella policy, insurance companies require that you maintain certain minimum amounts of primary liability insurance.
If you’re still wondering if a personal umbrella policy is right for you, contact your
insurance agent. They will help you analyze your personal liability insurance
to uncover any gaps that exist and help you prepare for the unexpected.
Check back regularly to keep up with our blog series on insurance reviews. And don’t forget to send in your questions or suggestions about the insurance issues that you care about most.