We all are exposed to different situations everyday where we can be held legally liable for our actions, inaction or circumstances. A homeowners’ policy that includes personal liability coverage and an automobile policy providing third party liability coverage are our first line of defense to common liability exposures. But what if the liability limits are not enough?
A Personal Umbrella policy provides excess liability coverage over and above the liability limits provided on an underlying homeowners and/or automobile policy. A personal umbrella policy typically will require a minimum $300,000 liability limit on a homeowners’ or renters’ policy and a minimum $250,000/$500,000 liability limit on a personal automobile policy. The limit on a personal umbrella policy will apply if the limit on the underlying policy is not sufficient to entirely cover a specific liability situation.
A personal umbrella policy offers inexpensive coverage in million-dollar increments from $1M up to $5M, and up to $50M thru certain insurance companies. To find out if your excess liability coverage is adequate, you would need to ask yourself how much you can afford to lose if you are sued. You should choose a limit based on your individual requirements and specific circumstances. You would need to assess and evaluate your assets such as your home, other real estate properties, personal possessions, savings, and investments, and make sure that your personal umbrella coverage limit will provide ample financial protection in the event you are sued.
Contact your insurance agent today to discuss your current excess liability coverage limit, request a quote or learn more about the benefits of a personal umbrella policy.