Personal Umbrella Insurance—Added Protection for When You Need It Most
When you buy insurance, you probably don’t want to think about a scenario in which you won’t be covered. Unfortunately, it can happen. If it does, you could face serious financial difficulties even after maxing out your insurance benefits. Personal umbrella insurance protects you when this happens. It covers the difference between damages you’re responsible for paying and the maximum amount of insurance coverage that you have.
When You May Use Personal Umbrella Insurance
Personal umbrella insurance can kick in for lots of different reasons. Consider these scenarios and what you would do if they happened to you:
- You cause a multi-car accident that damages several cars and injures multiple people. The injured parties sue you for their lost wages. Your car insurance policy does not cover the full amount of repairs and medical bills that are your responsibility. Furthermore, it doesn’t cover any of the lost wages.
- A natural disaster destroys your home and your property. Your mobile home insurance policy doesn’t provide adequate compensation to replace your home and your belongings.
- You serve on the board of a nonprofit organization. The board is sued for failing to ensure that the organization’s resources are used only for approved, tax-exempt purposes. You face significant legal bills and potential personal liability if the board loses the lawsuit. Neither the organization’s insurance nor your homeowner’s policy offers any coverage.
You can use umbrella insurance in all of these cases. It makes up the difference between your coverage and the actual damages. That helps you cover legal costs for a variety of lawsuits.
Umbrella Insurance Coverage: How Much to Get and Who Needs It
Most personal umbrella insurance offers generous benefits of $1 million or more. However, the amount of coverage you choose has a major impact on the price of your premiums. Generally, you should get enough umbrella insurance to cover your net worth. You may also wish to consider your future earning capabilities when determining how much personal umbrella insurance coverage you need. For example, if you are in school now in order to enter a lucrative field, you may want your umbrella coverage to be based on your expected future net worth.
Nearly everyone can benefit from having personal umbrella insurance. There are some people who should be particularly vigilant about getting it. Anyone with a high net worth should consider this coverage in order to protect his or her wealth. If you are in a profession where lawsuits against you are more likely, you may benefit from umbrella coverage. People who are concerned about their financial ability to pay for damage or injuries above what their insurance policies can may also benefit from the peace of mind of knowing that they have additional protection. Personal umbrella insurance is relatively inexpensive for the amount of coverage it provides. Therefore, it can be a wise investment for anyone.
What Umbrella Insurance Does Not Cover
As extensive as umbrella insurance coverage is, it doesn’t cover everything. You cannot use umbrella insurance to make up for not having minimum coverage on your home or car. Umbrella insurance supplements other policies, but it cannot be used in lieu of having them.
There are also several things that personal umbrella insurance will not pay out to cover. Lawsuits that involve criminal or intentional acts are not covered. The same is true for damage to personal property, damages caused by your business, or your own injuries in the case of an accident. Many policies also exclude property damage or injuries that are caused while using a personal recreation vehicle, like a jet ski or all-terrain vehicles. If you frequently use recreational vehicles, look for a policy that does not exclude these kinds of incidents from coverage.
Are you ready to learn more about personal umbrella insurance policies? National Mobile Home Insurance Company is here to provide clear, personalized advice to help you find a plan that meets your specific needs and budget. Get answers to your questions about personalized umbrella insurance by calling 1-800-388-6780.
