Five Reasons You Need a Personal Umbrella Policy

Let’s face the facts; we live in a world where anyone can get involved in litigation for almost any small or large accident. The cost of defending yourself and your family, even if you are right, can cause a major financial drain on your personal resources.

Are you prepared to fund the legal costs out of pocket? If not, we have a solution for you.

Your personal auto and homeowner's insurance plans protect you, but they aren't always sufficient. Unfortunately, personal injury and property damage from a bad at-fault collision can quickly deplete an auto or home insurance policy's liability limits.

Liability insurance in the form of a personal umbrella policy shields you from financial liability in the event that you harm someone or their property and they pursue a lawsuit against you. 

Personal umbrella insurance is typically a low-cost kind of insurance that can be purchased in $1 million increments and applies over and above your home and auto insurance. However, before purchasing an umbrella policy, most insurance providers would need you to have primary personal auto or homeowner's insurance.

Reasons You Need a Personal Umbrella Policy

It can cover volunteer work

Most companies automatically cover you if something happens while you are volunteering for a local nonprofit charitable, religious, or civic organization. If you are an active member of your community or with a local nonprofit charitable, religious, or civic organization.

Legal fees are included

Legal fees can be expensive, and they must be paid even if you win. These fees are covered by a personal umbrella policy in addition to your umbrella limit of protection.

Accidents happen

Even when all measures are taken, lawsuits and accidents occur. You should always be prepared for the financial consequences. If a claim exceeds your insurance limit, you'll have to pay the difference yourself. This could result in the loss of your investment, retirement, and personal property. Umbrella insurance is a low-cost approach to ensure that you are not financially ruined, even in the worst-case situation. 

It protects your personal assets

In the event of an unforeseeable accident, your assets can be protected and secured. This includes your car, home, investments, retirement accounts, bank and savings accounts, and even your future earnings.

It is reasonably priced

According to the Insurance Information Institute, you can purchase a $1,000,000 umbrella insurance policy for $150 to $300 each year. The prices are reasonable, and if you increase your limits, you'll get a better deal.

It provides peace of mind

Your car, house, or other possessions that could be the subject of costly lawsuits are designed to bring you joy, not dread. Your valuables will not be a source of financial ruin if you get umbrella insurance.

What Can a Personal Umbrella Policy Cover?

If you cause damage to another person or their property, umbrella policies can protect you from future financial obligations. The following are some examples of situations when umbrella insurance may be useful:

• An automobile accident in which you are at least partially to blame
• On your property, someone slips and falls or gets wounded in some other way
• Someone is bitten by your dog
• People get sick at your holiday party
• Your children injury another driver
• Injury to a guest if you own a pool
• When your bathroom floods, it fills your downstairs neighbor's home, causing water damage
• In a defamation case, you're found guilty

Do I Need an Umbrella Insurance Policy?

If you have any amount of assets, have teen drivers, have a retirement plan, or investments, you should consider purchasing a personal umbrella policy. Remember all your personal assets can be attached if you lose a lawsuit.

The key question to ask yourself is: am I in danger of being sued? Because everyone is, umbrella insurance makes sense.

A personal liability case can land even the most diligent individual with the best intentions on the hook for a large judgment. Even if you're unlikely to find yourself or your family in this circumstance, it's still a good idea to safeguard yourself from such a significant financial loss. This is something that umbrella insurance can assist you with.

Leap | Carpenter | Kemps Insurance Agency Can Help

At Leap | Carpenter | Kemps Insurance Agency, we actually think insurance is fun! Let us shop for you from over 200 insurance companies and get you the best deal for your dollar, including preferred premium pricing and multiple policy discounts. Contact one of our independent insurance agents at (888) 461-9635 today for a no-obligation Personal Insurance review.