Umbrella insurance, also known as personal umbrella insurance, is a type of liability insurance that provides additional coverage beyond the limits of your existing home, auto, or other primary insurance policies. It acts as an extra layer of protection to help safeguard your assets in the event of a significant liability claim or lawsuit.
Umbrella insurance covers a wide range of liability exposures, including personal injuries, property damage, and certain types of lawsuits. For example, if you were involved in a car accident where you were at fault, and the damages exceeded the limits of your auto insurance policy, an umbrella policy could help cover the remaining costs, up to the limits of the policy.
Umbrella insurance typically offers coverage in increments of $1 million, and higher limits may be available depending on the insurance provider. It is generally recommended to have an umbrella policy if you have substantial assets to protect or if you engage in activities that may increase your liability exposure, such as owning rental properties or having a high-profile profession.
The cost of umbrella insurance depends on factors such as the coverage limit you choose, your location, your personal risk profile, and the insurance company you select. However, umbrella insurance is often considered relatively affordable compared to the amount of coverage it provides.
It’s important to note that umbrella insurance does not typically cover intentional acts, criminal activities, or business-related liabilities. Additionally, it does not cover damage or liability arising from professional services, such as medical malpractice or professional errors. For those types of risks, separate professional liability insurance policies may be necessary.
It’s recommended to speak with an insurance agent or broker to understand your specific needs and to determine if an umbrella policy is appropriate for you. Learn more about Umbrella Insurance at this link: https://www.finstream.tv/videos/ask-the-hammer/ask-the-hammer-umbrella-insurance/