A personal umbrella insurance policy can protect you and your family against catastrophic losses by providing an extra layer of coverage. “Everyone should have an umbrella policy,” says Ralph Byer, Merrill Lynch Managing Director and Wealth Management Advisor. “It doesn’t take much to exceed the limits of your homeowners or auto insurance policy. A serious car accident or slip-and-fall on your property can be more than enough.”
Personal umbrella (excess liability) policies provide liability and defense cost coverage on top of standard homeowners, renters and auto policies. These policies can:
- provide excess coverage limits when the underlying policy’s limits have been exhausted;
- pick up where the underlying policy leaves off once aggregate coverage limits have been reached; or
- cover claims that may be excluded in the underlying policy.
Umbrella policies are rarely required but often necessary, particularly for those who:
- own property (personal, rental, investment);
- have or use cars, boats or other vehicles;
- travel abroad;
- own items likely to cause injury (pets, pools, trampolines);
- volunteer (nonprofit boards, youth sports); or
- engage in activities that could injure others (high-risk sports, hunting).
If you’re thinking that you don’t make enough money to need umbrella insurance, stop. “That’s a myth,” says Byer. “There is a common misperception that umbrella policies are only needed to protect extra money. In reality, most people need umbrellas to protect their essential money. Those with less often benefit more from an umbrella policy.”
Umbrellas are secondary policies, so you must have underlying insurance coverage that meets the insurance company’s underwriting requirements. Personal umbrella policies are relatively quick and easy to get. They are also surprisingly affordable. “Aggressive pricing and the ability to effectively reduce personal asset exposure,” says Byer, “have combined to make umbrella insurance an essential financial planning and risk management tool.”
Please contact us if you have any questions about umbrella insurance or would like a price quote.
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