Umbrella Insurance Makes Having Addional Coverage Easy

Umbrella Insurance

Umbrella insurance is also known as “excess liability” insurance. It is a secondary policy that covers a wide variety of contingencies. The purpose of an umbrella policy is to fill in gaps or exclusions in your primary policy. It comes into effect when the limits of your underlying insurance are exceeded. In other words, if you have coverage of $500,000 on your general liability policy, but you have a claim of $1,000,000, then your umbrella policy will cover the extra $500,000. In addition to covering overages such as this, umbrella insurance will probably also insure you against a variety of things that your general liability policy does not.

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What An Umbrella Policy Typically Covers

Umbrella plans are generally very thorough in the types of claims they cover. A good umbrella plan will typically cover things like the following: personal injury; contractual liability for both written and oral agreements; non-owned aircraft liability; watercraft liability; liquor law liability; and extension of coverage to other insured parties, such as business partners or employees. Coverage will of course vary by provider, so ask your insurance agent for a rundown of what your particular umbrella plan covers.

Lawsuits against individuals are common and can sometimes reach devastating levels. While your Personal Auto and Homeowner/Condo Unit Owner/Renter policies may provide coverage to help with these costs, it doesn’t take much for certain lawsuit amounts to exceed the limits of those policies. For example:

You cause an auto accident that permanently disables another driver.
Your pet dog bites a child, causing physical and psychological harm.
Your son or daughter is accused of cyber bullying, resulting in a defamation lawsuit.
You accidentally injure someone while boating or hunting.

These are just a few examples of the types of personal liability lawsuit situations that tend to result in very severe lawsuit amounts. A Personal Umbrella policy protects you in these situations by providing an extra layer of liability coverage over that provided by your other personal insurance policies. The Personal Umbrella insurance policy increases certain limits to $1 million or more, providing the extra coverage that can help secure individuals and families from severe liability costs.