If you’re at risk for lawsuits, then you might want to consider umbrella insurance. People can be held liable for injuries and property damage they cause to others. For example, you can be liable for slips and falls that occur on your property. Umbrella insurance provides additional liability coverage that your home, auto, commercial, boat and motorcycle insurance does not. If you’re sued for an amount that exceeds your standard insurance, then umbrella insurance will help up to its limits.
For example, if someone with $300,000 in liability coverage causes an accident that result in a lawsuit for $500,000, then there is a gap. The person who caused the accident is covered up to $300,000. Without umbrella insurance, they have to pay the remainder out of pocket. But if they do have umbrella coverage, then they will receive assistance. Umbrella coverage usually provides a minimum $1 million in coverage for an annual premium. It protects the assets of the policyholder, and pays up to $100,000 for legal defense.
Umbrella insurance isn’t just for wealthy people with a lot of assets. Anyone can purchase umbrella insurance. The best option is to speak with an insurance agent to assess your risk.
When you consider buying umbrella coverage, you should determine your net worth. You can start with a basic umbrella insurance policy, and then add more if necessary.