Umbrella Coverage – Not Just for the Wealthy

Both your homeowners and auto insurance policies have a certain amount of liability insurance built in. If someone gets injured and it’s your fault, your policy will pay up to that limit. But what if the other person’s injuries are actually much more costly? For example, you have a $300,000 limit on your auto policy. You cause an accident that injures several people, and the medical bills total $500,000. Your insurance will pay the first $300,000. Where does the remaining $200,000 come from? Unfortunately, it will come from you. Do you have an extra $200,000 just sitting around?
 
That’s where umbrella coverage comes in. It’s an extra policy that will kick in and pay the remaining $200,000. It’s not just for the wealthy. Here is who might need umbrella coverage:

- Anyone with savings, retirement accounts, homes, or other valuable assets
- Anyone who owns a trampoline, pool, tree house, dog, ATV or other ‘high-risk’ things
- Anyone responsible for the care of others – such as a nanny, coach, caregiver, etc.
- Anyone who participates in activities that can injure someone – football, martial arts, hunting, etc.
 
As you can see, there are a lot of reasons you might need an umbrella policy. And it’s not expensive. A policy that provides $1 million in coverage is usually $150 to $300 per year.
 
If you aren’t sure whether you should have an umbrella policy, talk to your agent. An independent agent can help assess what you need and can find the policy that is right for your situation.