Umbrella insurance picks up where the liability limits of your homeowners and auto policies leave off and covers not just the policyholder, but also other members of their family or household.
Particularly important for successful individuals and families, umbrella insurance is important if you:
- Serve on a charitable board.
- Have a swimming pool, pond, or trampoline
- Own dogs, horses, or other large animals
- Manage a family trust
- Host large parties in your home
- Employ household staff-think nanny, cleaning person
- Have a high public profile
- Travel frequently
Consider these scenarios where homeowner’s or auto insurance might not provide enough coverage:
- Your dog runs out of the house and viciously attacks a neighbor. Your neighbor sues you to cover her medical bills, lost wages, and pain and suffering.
- Your son gets into a kerfuffle at school and punches a classmate, breaking his nose. The parents sue you.
- You cause a 10-car accident and your auto insurance property damage coverage isn’t high enough to replace all 10 accident victims’ vehicles. Nor is your personal liability coverage high enough to pay for their medical bills.
- You send sandwiches to your child’s school for a field trip lunch. Several students develop food poisoning and their parents sue you.
- Your teenager throws a party at your house while you’re on vacation. Someone brings alcohol to the party, and one of the guests is arrested for driving under the influence on the way home. You are sued.
There are dozens of situations where you may need additional liability coverage. In general, your limit should align with your total net worth and at the very minimum cover the value of your assets.
Online umbrella calculators can show you the considerations to be made; like this one from Kiplinger: How Much Umbrella Insurance Do I Need?
Liability coverage isn’t finite like property insurance, it’s a discussion about lifestyle and individual risk tolerance. Call an Avery Agent today, to discuss your asset protection plan. 800-759-7579
