Umbrella insurance is a policy that provides additional coverage for your homeowners, condo, auto, or boat insurance. Basically, it provides liability protection for lawsuits filed against you. It’s a secondary form of insurance instead of a standalone policy.
Umbrella coverage is useful because it protects your financial assets. You could lose everything should you face a lawsuit. Property damage or injury that you cause could cost you a lot of money. Umbrella coverage helps with legal defense costs and any amount the court orders you to pay the plaintiff.
This type of policy is valuable for wealthy individuals with several assets and investments. But someone with fewer assets could benefit as well. Mainly because a court judgment against you can possibly take everything that you own. So even if you’re not rich, you want to protect what you have.
Most insurance policies have a limit on the amount of liability they’ll cover. So if the courts order you to pay the plaintiff $5000, then your insurance will pay up to its limits. That means if your limit is $4000, then you’re responsible for $1000. But with umbrella insurance, the $1000 is something that the umbrella policy will pay.
If you’re at high-risk for facing a lawsuit, you’ll want to consider this coverage. An insurance agent can give you more information about this type of coverage. It’s possible that umbrella insurance is something you should consider.
|Request a Quote Directly