All You Need to Know About an Umbrella Insurance Policy
You may wonder why you need an umbrella insurance policy when you already have insurance for your home and car, but as you increase earnings and assets, you require more protection for them. Umbrella insurance is a form of coverage that supplements all other policies. The core objective of this policy is to safeguard your personal assets from any unforeseen event including a tragic accident caused by you.
Umbrella insurance is considered one of the best ways to cover liabilities that may be unusually large and exceed base policy limits.
Coverage by Umbrella Insurance Policy
An umbrella policy grants additional excess liability above the expectations of your fundamental policy. By excess liability, we mean the coverage from one to five million dollars can be provided by the insurance company. The excess liability grants compensation for the following.
- Legal defense costs for a covered loss such as lawyer fees and associated court costs.
- Extra protection for your primary auto policy and auto-related liabilities
- Personal liability compensation for your on or off-premises.
- Worldwide coverage for the foreign use of cars, no matter where you go.
- Compensation against non-business associated with personal injury liabilities including libel, slander, false arrest, or wrongful eviction.
- Coverage for claims by others regarding personal injury, property damage, members of your family, or dangers on your property.
Coverage Cost of an Umbrella Policy
The coverage for the umbrella policy generally starts from $150 to $200 for a $1 million policy. Your coverage depends upon the premium amount. The premium amount increases if you decide to increase your coverage. But, increasing the policy limit to $2 million and getting twice the amount of coverage will not double your cost of the premium.
Significance of Umbrella Policy
Your house, car, retirement accounts, investments as well as your normal savings and checking accounts along with your future income are considered valuable assets. If you get sued for a large amount of money and you do not have sufficient liability insurance or an umbrella policy for compensation, then all your assets will be exposed. For this reason, you must consider buying an umbrella insurance policy as it helps you in preventing the possibility of financial damage because of an unforeseen accident or a single misstep.
Where Can I Get a Policy?
You can buy umbrella insurance coverage from various insurance companies and agents around you. But one of the best ways for getting umbrella coverage is through an independent and credible agent or an independent broker.