The goal when obtaining insurance should always be protection. Protection of the life you have built and your financial security. After all, insurance is one of the very few products available that will protect us when the worst in life occurs. So if protection is important to you, an Umbrella Policy is the way to go!
It’s best to think of an Umbrella Policy as an extension of the auto and home insurance you already have in place. The policy is designed to complement the existing coverage by extending it to higher limits. This will ensure the protection of your assets and financial well-being in the event of a claim.
An Example: “A driver sees a ball bounce out into the street. It’s followed by the young child who lost it. The driver can’t stop in time, and the child is severely injured. In court, damages are awarded to the child’s parents for $1 million. The driver’s auto policy pays its limit of $500,000 per claim; the driver is responsible for the remaining $500,000.”
Without an Umbrella Policy, the driver in the above example would have to find a way to pay the additional $500,000 in awarded damages. For most, this would result in substantial cash losses or require the liquidation of savings/retirement accounts or life insurance policies. If the necessary funds cannot be accessed, the courts can require that hard property be seized and/or any future wages be garnished until the debt is paid.
If the driver had an Umbrella Policy, the additional $500,000 in awarded benefits would be paid by the umbrella policy. What’s more, the driver could also access his umbrella policy to assist with his legal defense costs. Essentially, an umbrella policy could completely remove the negative financial impact resulting from the tragic mistake.
Perhaps the most appealing aspect of an Umbrella Policy is the affordability. While Umbrella coverage can range from $1 million in coverage all the way up to $50 + million, the price tag for the coverage received is often at cents on the dollar. An Umbrella Policy offers a great amount of protection but is still one of the most affordable insurance policies available.
And if big coverage at an affordable price was not enough, an Umbrella Policy also offers worldwide coverage, personal injury coverage, and vacation rental coverage!
To learn more about an Umbrella Policy that is right for you, reach
May 28, 2017
by Jeff Neuhalfen