You cannot tell if the lawsuit against you from an accident in your car or property will lose or win. If you lose, the amount you will have to pay to the other party also varies. These unfortunate incidents can result in a drastic financial loss. Consider buying an umbrella liability policy to protect yourself from such losses.
Understanding An Umbrella Policy
This policy starts working when your homeowners and car insurance stop covering you. It is designed to meet your other insurance policies, so umbrella is high deductible. It is also designed to protect both your current and future assets, for example, your inheritance, lottery winning money, or wages. It is extremely important as the cost of paying medical bills or lost wages from the lawsuit can quickly pile up. An umbrella policy can benefit both the wealthy and not so wealthy.
What Does It Cover?
An umbrella policy offers excess coverage beyond the amount of your homeowners and car policies. So, for example, if your homeowners insurance covers the amount of $400,000 for the medical expenses caused by an accident in your property, and you are sued for $800,000, your umbrella policy will cover the remaining $400,000. In general, an umbrella insurance policy covers from $1 million to $5 million as excess coverage. If you have more personal assets, the amount of additional coverage is bigger.
Your umbrella policy also covers the legal expenses if you are dealing with a lawsuit. It is quite beneficial especially if you lose wages due to attending legal proceedings. Your insurance company may also provide you with the best legal team, as they also want to protect the money of the company.
Your umbrella policy also covers your dependent children in case they cause an accident. It also covers personal injury lawsuits that resulted from false arrest, defamation of character, mental anguish, slander, malicious prosecution, imprisonment or detention, and many others.
You have a high risk of being sued, hence the greater need to buy an umbrella policy, if:
- You have a swimming pool at home
- You commute for long hours
- You always have house guests at home
- You drive during rush hours
- You have a dog
Even if you are not at high risk, you may need extra coverage as you cannot predict what would happen in the future. Keep in mind that you need to have homeowners and car insurance first before you can purchase an umbrella policy. Ask your insurance agent about the details of your specific policy. At Filer Insurance, Inc., we aim to provide comprehensive insurance policies that makes your life easier. You can get more information about our products and services by calling our agency at (305) 270-2100. Get your free quote today by CLICKING HERE.