Umbrella Insurance Protection
What is the Money Date? A weekly time to check in. 3 things we review and update: 1. Spending 2. Earning 3. Savings
Let’s switch gears a talk about additional liability coverage that many of us should have, but don’t. It’s called Umbrella Insurance. It’s really the ultimate rainy-day policy!
When we reviewed homeowners, renters, and auto policy: all of these coverage policies provide personal liability protection in case there is a bad accident and you are held liable. For some of us, more coverage is needed because we have more assets to protect or we earn significant income. That’s where Umbrella excess liability comes in. It provides protection in excess of what your primary policies covers and extends coverage in case of catastrophic losses.
For example, if you have an auto policy with $500,000 liability limit and you need to get additional coverage to protect your net worth, you might get an Umbrella Insurance policy. You will go for the $1,000,000 umbrella policy, the usual starting point/dollar figure for such policies. Now your overall liability coverage will be $1,500,0000. $1,000,000 of coverage cost on average about $150 per year, so it can be worth the extra investment to make sure you’re protected.