Your liability insurance has you covered, but what is covering your insurance? When it comes to protecting yourself against lawsuits, having enough coverage is essential to safeguard your income and assets from the potential for loss. In most cases, the high limits on an auto or home insurance policy are enough to pay for third-party damages and personal legal expenses. However, some incidents result in much more extensive litigation costs and judgments that exhaust the limits of primary liability insurance. A personal umbrella policy acts like a safety net, paying for damages when they exceed your coverage value up to the limits of your umbrella coverage.
Understanding Umbrella Insurance
Umbrella insurance covers many of the things you already have coverage for through other types of insurance. It merely extends the limits of that coverage – usually by as much as $1 million or more. The details of your coverage will vary depending on your policy and insurer, however, most policies provide similar coverages and exclusions.
A typical umbrella policy will cover damages you cause to someone else’s property or injuries you cause by accident. It also extends to liabilities you incur due to the negligence or accidental actions of household members, including your pets. This can include damages caused by car accidents, pet aggression, and more. In addition, umbrella insurance typically pays excess damage claims for injuries occurring in your home, yard, or in your swimming pool. It can also pay for damages not covered by other types of policies, such as landlord liability, incidents occurring while traveling abroad, and accusations of defamation, malicious prosecution, or false arrest.
Although umbrella insurance covers a wide swath of losses, many fall outside the boundaries of coverage. For example, umbrella policies typically exclude coverage for losses stemming from contract disputes or business-related liabilities. There is also no coverage for intentional, willful, or criminal acts under most circumstances. Likewise, umbrella insurance does not cover personal losses, such as damage or theft of your personal property.
Who Needs Umbrella Insurance?
This is an important question that everyone should know the answer to. The fact is umbrella insurance is one of the most under-purchased coverage types – often due to misunderstandings about the product and who it is for. Many people assume they will never need $1 million of excess liability protection if they are not wealthy and do not have a significant accumulation of assets. However, there is much more at risk than what you have access to right now.
For example, if you are sued for causing a major injury or fatality, the damages could easily reach $1 million. If your primary liability insurance covers $250,000, how will you pay for the remaining $750,000 without umbrella insurance? The victim may pursue recovery of compensation through your income and liquidation of your assets. This can include current income and assets, as well as future windfalls, such as an inheritance.
There are many ways you could find yourself unexpectedly at the center of a liability-driven lawsuit. Examples of common victim claims include:
- Slip-and-fall accidents in your home
- Car accidents when you or your teenager is driving
- Injuries instigated by your pet
- Injuries occurring on your trampoline or in your swimming pool
- Tenant or guest injuries due to rental property maintenance negligence
- Watercraft accidents
- Losses due to accusations of libel, slander, defamation, or false arrest
- Mental anguish and shock
- Emotional trauma
- Lost wages
- And more
Every circumstance is different, and we recommend talking with an independent agent here at Strobel Insurance to better determine your supplemental liability coverage needs. However, we typically recommend umbrella policies to individuals who need to have or expect to one day have:
- Valuable assets
- Retirement or college savings
- A business
- A second home
Don’t Take Chances with Your Livelihood
It does not matter how carefully you live your life, all it takes is one mistake to create a cavalcade of financial problems that could follow you for years to come. Why risk losing everything you’ve worked hard for when a simple insurance policy could help save the day? Talk to an agent at Strobel Insurance to find out if umbrella insurance is right for you.
Cost of Coverage
Many factors can influence your umbrella insurance costs. However, this coverage overall offers significant value for the average cost of premiums. In fact, some policy-holders can qualify for $1 million of coverage for as little as $20 per month or less. Additional coverage is available in increments of $1 million, usually at proportionately lower prices as coverage amounts increase.
In addition, working with an independent agent can help you get maximum value from your coverage. Strobel Insurance works with multiple Wisconsin insurers to help you compare rates on the coverage you need. Our in-house shopping provides a one-stop-shop to ask questions, get advice, and choose which policy is right for you.
Before you can qualify for umbrella insurance, your insurer may require you to meet certain eligibility guidelines regarding your primary auto, renters, or homeowners liability coverage. We can help you meet these coverage requirements by modifying your existing coverage if necessary.
Wisconsin Umbrella Insurance Quotes
If you plan to purchase umbrella insurance or need to upgrade your existing coverage, we can help. To find out more about umbrella insurance in Eau Claire and the surrounding areas, contact Strobel Insurance today. We look forward to helping you protect your income and assets for years to come.