What Is Umbrella Insurance?

Umbrella insurance is an additional liability policy that can be purchased to enhance your insurance coverage. It provides extra protection in the event that you are sued for an amount above and beyond what your other insurance policies cover. Umbrella insurance, also known as "personal liability insurance," is a good investment in today's day and age where people are more likely to sue one another for just about anything. This type of insurance is named "umbrella" because it sits on top of your other insurance policies like a guardian, protecting you in the event they are maxed out.

Who Needs Umbrella Insurance?

It used to be that only wealthy people needed this type of insurance because they were more likely to be sued. It isn't that way anymore. Now nearly anyone and everyone should have this insurance. Umbrella insurance protects your home, automobiles, boats, and other large assets. It kicks in when your other insurance policies have run dry.

If you caused a bad car accident and several people were injured, your insurance company could easily be sued for well over a million dollars. In a case where you were liable, your insurance company would need to cover all medical bills, lost wages, and rehabilitation costs for the injured parties. This expense could easily eat up all of your insurance benefits leaving all of your personal assets at risk.

If you didn’t have an umbrella policy, the representatives of the injured persons could go after your home, cars, boats, jewelry, or even your salary. You could end up paying a portion of every paycheck out for many years, or even for the rest of your life depending on how large of an amount the claimants were awarded by a judge.

It’s not a bad idea for everyone to look into umbrella insurance. In most cases it doesn't cost much and it could save you a lot of money if something unfortunate were to happen. The peace of mind, knowing that you are fully protected, is worth the extra money.

Getting a Deal on Umbrella Insurance

Umbrella insurance policies are thought to be one of the best deals in the insurance industry. But that doesn't mean that you shouldn't shop around when seeking out coverage. The same type of policy could cost you much more through one insurer than it would if you bought from another. Take time to compare prices and coverage levels before purchasing a policy. It is the only way to make sure you get a good deal and reliable coverage.

Guest post from Bailey Harris. Bailey writes about insurance and other topics for the Home Insurance Blog.