What is an Umbrella Policy?
An Umbrella Policy provides valuable extension of liability coverage for your home, auto, boat or motorcycle in case of a serious loss where you are being held responsible. Umbrella policies provide a tremendous value for a low annual premium.
I have car insurance, why would I need a supplemental plan? Take a look at your current policy. What is the Bodily Injury Liability, Property Damage Liability, Medical Payments and uninsured Motorist Bodily Injury limits?
Typical Auto Insurance limits may look like this:
Bodily Injury Liability – $100,000 per person/$300,000 per occurrence
With the cost of medical tests, treatments and any pain & suffering you may be responsible for substantially more than 100K. For example, the average cost to stay in the hospital is $10,000 per day.
Property Damage Liability $100,000 per occurrence
At the time of writing this article a Tesla 2018 Model X Premium was $104,900. If you’re unlucky enough to total one of these, cause a tractor trailer accident, in an accident involving multiple cars, or damage private property, you can easily exceed the 100K limit and be responsible for the overage.
Medical Payments – $1,000 per person
If you are involved in an at fault accident, health insurance may not cover all your expenses like ambulance/air evac service.
Uninsured Motorist Bodily Injury – $100,000 per person/$300,000 per occurrence
Covers you and your passengers after an accident with an uninsured driver. Similar to risks mentioned above: expensive or lingering treatments can easily exhaust this limit, leaving you liable for additional medical expenses.
Why Umbrella Policy?
Riding in to save the day could be an Umbrella Policy to extend these limits. Often with $1-$5 million dollar limits annual premiums start around $150-$600 per year.
Keep your family nest egg and retirement plans intact from an unforeseen accident.