When explaining the importance of having umbrella insurance to insureds, I often find that a lot of people don’t fully understand what umbrella insurance is and why they need it. The way that I’ve always thought of umbrella insurance is thinking of an umbrella placed overtop of everything that’s important to you. Umbrella insurance sits overtop of the insurance you already carry (home & auto) and tends to be inexpensive to the average person in comparison to the amount of coverage that you are adding to your insurance arsenal.
An umbrella policy goes beyond the basic home and auto policy and helps protect against claims that would not be covered otherwise. For example: if you exceed your limits on a home or auto claim your umbrella would then kick in and pay out the remainder of the claim OR if you’re faced with a claim that isn’t covered under a standard policy (lawsuits, slander, etc) your umbrella insurance would help protect you.
Still confused? The best example tends to be with car accidents. Say there were an accident that caused injury to someone else, or multiple people, your auto policy covering up to $200,000 would likely cover the other driver’s property damage but medical bills and lawsuits could put you over that limit. And guess where those additional funds come from when your insurance has been exhausted? Your pocket. You also must understand that liability doesn’t just mean hospital stays, it means trips to the chiropractor after, mental anguish or any injuries sustained that kept the other party from performing their work. And in that case, they could sue you for damages.
A real life example is a couple lived in a development, their Golden Retriever just happened to be in the garage with the owner when an elderly man, age 93, was taking a walk past the home. As he was walking by, the exuberant pup decided to run up to the elderly man. Even though the dog never meant the elderly man harm, the elderly gentleman fell to the ground startled by the dog. Later succumbing to his injuries in the hospital, the family filed a lawsuit against the couple resulting in a very expensive payout. Had this couple not had an umbrella policy, those funds would have had to come out of the insureds pocket.
Let’s make sure you’re covered properly. Allow us to be your trusted advisors and reach out to us today so we can review your current limits and set you on the right path.