Ensure Blog

What Is An Umbrella Insurance A Policy – 5 Things You Need To Know

You have heard of Home, Auto, Motorcycle, and Life insurance, but what is Umbrella Insurance? You know that an umbrella protects you from getting wet in a rain storm, well, umbrella insurance protects you from getting financially caught in a storm.

An umbrella insurance policy is very helpful if you are being sued and the dollar limit of the original policy has been exhausted.  It provides an additional layer of security to protect you from being sued for damages to other people’s property or injuries caused to others in an accident and protection for your car, boat and homeowners policies.  It also protects against libel, vandalism, slander and invasion of privacy.

A personal liability policy, commonly called an umbrella policy, is a last line of defense against lawsuits.  When other insurance has reached its limit, an umbrella policy will pay claims up to the amount covered.

Consider this situation: someone slips and falls on your icy driveway and then you run over and accidentally kill the person who slipped because you didn’t see them. If you have $1 million limits each on your home and auto policies and the victim’s estate wins $10 million in a negligence judgment it can disrupt your financial future forever! You could face financial ruin unless you have an umbrella policy that covers the difference.

Liability risks are everywhere.   You think of auto accidents as needing umbrella coverage because you could be sued for medical damages endured by an injured person.  However did you realize that’s not the only accidents that happen? 

Accidents that can occur at home such as:

  • someone falls down your stairs

  • your balcony collapses during a party

  • a person hurts or drowns in your pool

  • breaks a leg on your trampoline

You are justifiably concerned about the consequences of a child or anyone getting injured on your home premisses and it is better to have coverage in place then assume that “no one would sue, we are friends/family”

Pets are also a concern.  For example, let’s say your  four year old child was playing with the neighbor’s dogs.  Despite the fact that the child had played with the dogs a 100 times before something out of the ordinary happened this time–the dogs attacked the child and he suffers from serious wounds or even worse, died from his wounds.  Should the adults have had coverage of an umbrella policy the family would at the very least be able to cover for the medical expenses and if there is legal recouse, you the parent have the right to persure monetary compensation from that neighbor.

Accidents at home are not the only places where such life changing accidents happen.

There are other dangers to consider such as vacation time.

  • rented a car, went sight seeing off the beaten pat

  • rented a boat or jet ski to spend time on the water

  • Took up snorkling lessons

  • Perhaps rented some snowmobiles to explore the wilderness

Are you thinking about  what would happen if you lost control of the jet ski?  No!  An accident can happen in the blink of an eye.  An umbrella policy provides  coverage for accidents while you’re driving in another country or while you’re on vacation and have rented a boat or Jet ski.  It would certainly bring peace of mind and a much happier vacation.

Personal injury can take many forms, including:

  • bodily injury

  • shock

  • emotional distress

  • mental anguish

  • sickness or disease

  • death arising from any of the above

  • false arrest

  • detention or imprisonment

  • malicious prosecution

  • wrongful entry or eviction

  • humiliation

  • libel or defamation of character

  • invasion of privacy.

Can you imagine how an umbrella policy is something to be considered? The chances are remote and many people might feel it is not worth buying.  Yes, it does rarely happen, and that is why it actually is quite cheap.  If you can bundle it with your car and home insurance you may even save more.

Five things to know about umbrella insurance:

  1.  Without it, you could lose everything

 2.  Liability risks are everywhere

 3.  You are insuring against the worst case scenario

 4.  A lot of coverage costs very little

 5. Coverage for incidents on vacation

Ready to set you and your family up with the best protection at the best price? Contact one of our Insurance Architects to see how much it would cost, it anything, to set up your umbrella insurance policy. You work hard, your and your family deserve to not have the things you have earned taken away from you.