Georgetown Insurance Agency

Umbrella Insurance – What’s Peace of Mind Worth to You?

by Melissa Gilbo, CISR on Jan 10, 2015

2015 is here!!!  The beginning of a new year is always a good time to set a New Year's resolution and it's also a good time to make sure you have a plan in place to protect the life you have built. Something to think about this upcoming year is Umbrella Insurance. A personal umbrella policy provides an additional layer of personal liability protection. It is the additional protection you need in case a judgment against you exceeds the liability limits of your existing auto or homeowners policy. And compared to the risk of a catastrophic event, umbrella insurance is very affordable and will afford you some peace of mind.

A good question to ask yourself would be, “Is the liability insurance you have with your auto or home policy enough to cover all your assets?” A severe car accident or mishap on your property could trigger a costly legal claim in excess of the liability insurance coverage you have on your auto or home. The fact is, it only takes one serious accident and a resulting lawsuit to put everything you own – and will own – at risk. A umbrella policy can help to protect it all.

Here are a few things you should know about umbrella insurance:

  • Personal umbrella policies typically offer $1, $2, $3, $4 or $5 million of liability coverage. Consider your net worth when choosing your coverage –you could be sued for everything you have.
     
  • An umbrella policy is not a stand-alone policy. Your insurance carrier will typically require you to meet certain qualifications, such as having an auto policy with a certain level of liability coverage, in order to purchase umbrella insurance.
     
  • Even when you have umbrella insurance, your car or home insurance is your first line of defense. For example, if you are liable for $2 million in a car accident and your auto insurance covers $500,000 of liability, your auto policy covers the first $500,000. Your umbrella policy covers the remaining $1.5 million, assuming your policy covers the incident and that you purchased that much coverage. If you are liable for $250,000 in an accident on your property and your homeowners insurance covers $300,000, your umbrella policy won’t be needed.
     
  • If you insure a motorcycle, ATV, golf cart, snowmobile, motorhome or watercraft, your umbrella policy may provide additional liability coverage on top of those policies as well. Be sure to check with your carrier to confirm your coverage on these types of vehicles.
     
  • A single umbrella policy typically covers all of your family members who are residents of your household.

Essentially, an umbrella policy gives you excess liability coverage on top of what your other policies provide. If you’re at fault for a serious accident, you’ll need it. Umbrella insurance also gives you liability coverage in instances where other policies don’t. Examples include driving in a foreign country or renting a boat.

If you live in MA or NH and you’re curious about how umbrella insurance might play a role in protecting the life you’ve built or plan to build, give Georgetown Insurance agency a call or visit our website to request a quote.

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