5 Things You Need To Know About Umbrella Insurance

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1. Without it, it could ruin you

For example, if you cause a car accident and the other driver sues, your auto insurance covers you up to your personal-liability limit, which is probably between $50,000 and $500,000. Same applies to your homeowners insurance if a guest slips on your steps.

An umbrella liability policy pays for settlements and legal fees above your limit. Without umbrella insurance, your income and assets are at risk.

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2. Liability risks are everywhere

“More than 80% of umbrella losses are auto-related,” says Ed Charlebois of Travelers Insurance.

Doing a home remodel? Your general contractor may not vet the subcontractors for workers’ compensation or liability insurance.

Like to have large get-togethers? If a guest gets into a DUI accident, the victim can come after you. Got a pool, hot tub, boat or trampoline? Then you have risk factors.


3. You want to insure against the worst-case scenario

The average awarded for a vehicle accident liability cases is $306,000. That’s why many financial planners say an umbrella policy is a must for those with significant net worth.

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4. Get a lot of coverage for not a lot of money

A typical homeowner with two cars can get a $1 million policy for $250 to $400 a year.


Worldwide Coverage

If you travel often, a personal umbrella provides international coverage for personal liability. If you are sued for a matter international you are covered as the liability portion of your policy follows you internationally.