Umbrella insurance provides additional liability insurance beyond the limits of what other insurance will pay and covers exclusions of other policies. Typically umbrella policies protect against litigation (lawsuits) rather than personal damages or loss.
A Personal Umbrella Policy (PUP) covers personal liability, commercial property and business owners can get commercial umbrella insurance designed specifically for the business world.
What Do Umbrella Policies Cover?
Umbrella policies are meant mainly to cover liability (lawsuits, medical, etc) and not your personal property. For instance, if someone hurts themselves at your home or you get an a car accident and the home or auto doesn’t pay the full amount the umbrella kicks in. If a flood hits and that was excluded from your homeowners liability won’t typically pay.
What Insurance Types Does Umbrella Insurance Pair With?
Umbrella insurance typically covers auto and homeowners insurance, but can also apply to other insurance types. For instances an umbrella policy can be designed to cover renters insurance, landlords, boats, other property, commercial property, or businesses.
Should I get an Umbrella Policy?
The more assets you own and the higher their value, the more an umbrella policy might make sense for you. If you own commercial property or a business you should consider commercial umbrella insurance.
Can I Get an Umbrella Policy Instead of Other Insurance?
An insurer typically won’t sell you an umbrella policy unless you already have other home or auto insurance through them.
How Much Do Umbrella Policies Cost?
Umbrella policies typically cost between $150 – $300 for the first million of coverage and then about half that for each additional million, prices vary based on a number of factors.
When Do Umbrella Policies Pay?
Since umbrella is a secondary insurance and only kicks in when the other insurance maxes out, most people will never actually use their umbrella. Hence the high dollar coverage for a low price.