Umbrella Insurance is a personal liability secondary insurance. Unlike other policy has a definition of an incident, it almost covers everything that other insurance does not.
Umbrella insurance is cheaper and provides high liability limit coverage, for example, $1 million Liability coverage can cost only $150 to $300 per year.
It provides coverage to the policyholder and his family members.
It covers injury to others and their property but not policyholders.
It protects you when you or your family member is liable for a claim or a claim arising from a lawsuit which is larger than your home or auto insurance liability limit. In such cases Umbrella opens up where other insurance limit leaves off; it picks from there and protects your assets and saving.
It also covers lawsuit expenses and attorney fees on top of the policy limit, or you may get a legal team from the insurance company, yes better than you could afford as the insurance company’s money is at risk and will try to save it. Sometimes you may find it indispensable for many reasons.
Primary Insurance requirement to get umbrella insurance | Required Underlying insurance for Umbrella
Umbrella Insurance is secondary insurance, you must have standard home and auto insurance with certain limits to get umbrella insurance. These liability limits may vary from one insurance company to another insurance company. If you get home, auto, and umbrella insurance from the same company then you must ask for a bundling discount.
Exclusion to Umbrella Insurance
- Racing or high-risk activities
- farm tractors
- Crimes and Intentional Acts
- Healthcare Costs
- Damage to your own property
- Damage on purpose
- Liability from business
- Loss due to war or arm conflicts
Conclusion
When you feel home and auto insurance liability limits are not enough for your protection and adding additional liability limits makes it (home and auto insurance) even costlier then Umbrella Insurance is the cherry on top.