Umbrella Insurance

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What is Umbrella Insurance?

Umbrella insurance is extra liability insurance. This type of insurance policy is designed to help protect you from major claims and lawsuits and, as a result, it helps protect your assets and your future. It does this in two ways:

  • Provides additional liability coverage above the limits of your homeowners, auto, and boat insurance policies. This protection is designed to kick in when the liability on these other policies has been exhausted.
  • Provides coverage for claims that may be excluded by other liability policies including: false arrest, libel, slander, and liability coverage on rental units you own.

Because it is in excess of specifically defined limits, your agent may have to raise the limits on any underlying home, auto, boat or motorcycle policy in order to provide the correct base limit. For example, a policyholder has an auto policy with underlying liability limits set at $100,000, but the umbrella policy expects them to be at least $250,000. Your agent would increase the policy liability limit on your auto policy from $100,000 to $250,000 before is using the umbrella policy.

What is Covered?

Here are examples of the types of coverages provided by an umbrella policy and how they protect you:

  • Bodily Injury Liability – covers the cost of damages to another person's body. Examples include the cost of medical bills and/or liability claims as a result of:

    1. Injuries to other parties due to a serious auto accident where you are at fault.
    2. Injuries caused to others as a result of your dog (yeah, you probably should have taken him to obedience school).
    3. Injuries sustained by a guest in your home due to a fall.
    4. Injuries sustained by a neighbor's child who falls while playing in your yard.
  • Property Damage Liability – covers the cost of damage or loss to another person's tangible property. Examples include the cost associated with:

    1. Damage to vehicles and other property as a result of an auto accident where you are at fault.
    2. Damage claims incurred when your pet rips a friend's priceless oriental rug to shreds.
    3. Accidental damage to school property caused by your child (hey, you can't disown them).
  • Owners of Rental Units – helps protect against liability that you may face as a landlord. Examples include the cost of liability claims as a result of:

    1. Someone tripping over a crack in the sidewalk of your rental property and using you for damages.
    2. Your tenant's dog biting someone and your being held responsible for the injuries.
  • Coverage is also provided should you be sued for:

    1. Slander – injurious spoken statement
    2. Libel – injurious written statement
    3. False arrest, detention, or imprisonment
    4. Malicious prosecution
    5. Shock/mental anguish
    6. Other personal liability situations

Other Situations

Commercial insurance customers are also eligible for Commercial Umbrella policies in the same or similar ways as personal lines customers.