What is Umbrella Insurance, and how can it benefit you? Here is information that should clear up any questions you may have.
Umbrella insurance is a liability insurance supplement to your basic liability policies that would include your auto, home or renter’s insurance. An umbrella liability policy is extra protection that covers a much higher limit than basic auto or home claims.
You will be protecting your assets with an umbrella insurance policy in case of an unforeseen event. For instance, a tragic accident in which you are held responsible for damages or bodily injuries would be covered by your umbrella policy. If you are faced with a lawsuit, your umbrella coverage will pay for the damages which are your legal responsibility, up to the limit of the policy.
An umbrella policy provides what is called “excess liability”. If you are faced with claims for bodily injury liability or property damage liability, your umbrella insurance will cover these. Umbrella policies also provide a more extensive coverage and can help cover legal fees, false arrest, libel, and slander.
An umbrella policy only pays once your basic liability limits have been exhausted or the claim is excluded from the basic liability coverage. The claim will be made against you, the policyholder, on behalf of the wronged party. Then your insurance company may pay the settlement amount up to the limits of your coverage. If the settlement amount exceeds your coverage limits, you are responsible for paying the remaining amount out of pocket.
Everything you own: your house, car, investments, stocks, checking and savings accounts and even your future income are all assets. It’s good to consider that if you are sued for a large amount of money and your liability insurance won’t cover your loss, and you do not have umbrella insurance, all your assets are at risk.
An umbrella insurance policy could prevent financial ruin if you were faced with an unexpected event. People who choose to carry umbrella insurance can enjoy the peace of mind that comes with knowing they are protected against an unforeseen, damaging scenario.
If you still have questions, give us a call to find out more from your reliable, independent insurance agent.