Umbrella Insurance

Umbrella insurance provides additional protection in conjunction with existing coverage by protecting you and your assets from major lawsuits. In short, this policy boosts your liability coverage above existing limits of your homeowners, boat, and auto insurance.

The Workings of an Umbrella Policy

This policy comes into play when the existing liability coverage on your primary insurance is not enough to cover your expenses.

For example, say you cause an accident and the other driver is seriously injured. Your auto insurance has a limit of $150,000 to cover all of the other driver’s medical expenses. But what if that is not enough? If you are sued for $850,000, your auto policy will only pay $150,000. That means you are liable for the remaining $700,000. A personal umbrella policy can provide the extra coverage you need. Otherwise, you would have to come up with the money from your own pocket.


Umbrella insurance is usually available in $1 million increments, meaning you would receive $1 million or more in additional liability coverage. Umbrella insurance also covers claims that are not usually covered by standard policies. This includes incidents such as slander, libel, and accidents with rented vehicles. You will also have legal defense assistance, including costs and attorney fees.

This is beneficial because if you are sued, it is possible you could lose everything you’ve worked all your life to build. After all, the more you have accumulated, the more you have to lose. This coverage helps shield those personal assets. In other words, you would not have to sell your house to pay for a lawsuit.

Umbrella insurance is generally purchased by people in high-income brackets. However, anyone can benefit from umbrella insurance. It’s important to assess your risks by speaking with an insurance professional.