A personal umbrella policy adds additional coverage to your homeowner’s and auto liability insurance policy. The umbrella policy is available to pay for the remainder (or at least part) of a claim that exceeds limits on either your auto or homeowner’s policy.
For example, your homeowner’s policy might provide a $100,000 liability coverage. If your dog bites someone visiting your home, or a friend of your child is seriously injured in your pool, your homeowner’s insurance might not be enough to cover the liability claim. Your umbrella insurance policy will provide additional coverage.
You may have automobile liability coverage of $250,000 per person and $500,000 per occurrence. But your teenage child causes an automobile accident involving multiple vehicles and multiple passengers in each vehicle. The $500,000 may not be adequate. Your umbrella insurance policy will provide additional coverage.
The umbrella insurance policies are typically sold in increments of $1,000,000. Therefore, the $100,000 liability coverage with your homeowner’s insurance policy will become $1,100,000 of coverage, or more.
We recommend that an umbrella policy of at least $2,000,000 is appropriate. Insurance carriers have requirements of minimum coverage to allow the purchase of an umbrella insurance policy. Discuss this subject with your insurance agent.
The information provided above is general in nature, and should not be construed as legal advice applied to a specific situation. Please discuss the facts of your situation