When it’s raining outside, you grab an umbrella. Why? To protect your clothing, hairstyle and anything you might be carrying from getting wet and potentially ruined. Why would you treat the protection of your property or assets any differently? Don’t let the “thunderstorms” come without protection – consider purchasing a personal umbrella insurance policy. After all, being protected is always a good thing.
What exactly is a personal umbrella insurance policy? It’s an add-on to your existing policies, whose primary goal is to help protect you from any claims and lawsuits. It provides additional coverage above and beyond the covered limits of your homeowners and vehicle (including boats) policies. It’s a very affordable means of protecting your assets and therefore, your future. You may ask yourself if you really need that extra protection. It’s easy to make that determination by asking yourself if you do or have any of the following:
- Operate a vehicle
- Own pets
- Have house guests periodically
- Operate a boat or any other watercraft
If you checked “yes” to any of the above, you’re answer is “yes” – you will want to consider purchasing an umbrella policy.
Your next question might be to determine if this policy addition is really necessary since you already have good homeowners and automobile insurance. Yes, that’s true. But there are probably some areas not covered. Today the number of uninsured and underinsured drivers is high. The National Association of Insurance Commissioners (www.NAIC.org) states, “According to the Insurance Research Council, nearly 13% of motorists, or about one in eight drivers were uninsured in 2014.” And that figure has most likely risen. Also, bear in mind that that figure doesn’t include underinsured drivers. Umbrella insurance will protect you in an auto accident when you are at fault as often your auto insurance policy will fall short of covering extreme auto damage and medical bills.
Umbrella insurance also covers other areas in your homeowners policy should a guest fall or get hurt at your home. Or, if your dog bites anyone at your home, you are covered for those extra expenses. It also protects you if you are being sued for causing harm to another person or property by covering some legal fees above what your main policy covers. If you didn’t have the umbrella policy, you could be expected to pay the extra costs (above your insurance limit) out of pocket, or have liens placed on your home, have your wages garnished, etc.
Now that you know you need umbrella insurance, you still need to determine how much coverage you need. Most umbrella policies begin with a minimum of $1 million. That may seem like an overwhelming amount, but consider how much medical care, recuperative therapy and property repair and replacement (such as vehicles and homes) cost and it becomes clear that $1 million can be used up quickly!
Give all of this some thought and sit down with your insurance agent to discuss your personal umbrella insurance needs. Be prepared in case it rains!
This information is not intended to be exhaustive nor should any discussion or opinions be construed as professional advice. Should you have any questions or would like to discuss your risk exposure with your family’s insurance, please contact the insurance pros at ARCW Insurance. We are here to help.