An umbrella policy is an extra layer of liability insurance coverage over and above your homeowners insurance, auto insurance and watercraft insurance. Homeowners insurance and auto insurance includes some liability coverage. The amounts of liability insurance coverage available vary by insurance companies. Most insurance companies offer liability limits up to $500,000 on homeowners and car insurance policies. In today’s world more and more lawsuits result in damages well over this figure. The premiums associated with increasing your limits of liability hundreds of thousands of dollars can be as little as $1/month. Personal Umbrella policies can give you $1 million and more in liability coverage on top of your existing liability coverage for as little as a couple hundred dollars a year. Umbrella policies in Texas can be up to $10 million.
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Many people believe $300,000 in liability on their homeowner’s insurance policy is enough coverage for them. They may not believe they have enough assets to justify additional coverage. In the case of a loss a judgment or lien could be implemented on any future earnings, inheritance or other sources of income. An umbrella policy can help eliminate this type of loss on future earnings. Liability coverage can also pay for Legal Defense costs even if you are not at fault for a loss.
Umbrella limits also help when the underlying liability Aggregate limits on your other insurance policies are exhausted. Aggregate amount is the amount of coverage provided on a per year time period.
As drivers we put ourselves in a dangerous position every time we get behind the wheel of a car. It only takes a phone call or a spilled drink to cause us to swerve and possibly injure someone else.
What are some obvious reasons to have an Umbrella Policy?
- Swimming Pool
- Underage Drivers
- Jet Ski
- Large number of gatherings on your property
If you have any questions regarding these items or other risks contact us.
What are some of the losses that can be covered by an Umbrella Policy?
- Medical Bills
- Loss Wages
- Property Damage
- Personal Injury (False arrest, Libel, Slander, Defamation of Character, Invasion of Privacy)
- Legal Defense Costs
Umbrella polices will often cover the named insured, resident relatives, and resident under 21 who is in the care of the named insured.
Several of the reasons on why a family or individual needs extra liability coverage provided by an umbrella policy pertain to business and companies as well. A commercial insurance Umbrella policy is often recommended for any business insurance plan.