Is Umbrella Insurance Worth It?

Is Umbrella Insurance Worth It?

May 4, 2021

You may think that you’re prepared for the worst once your life, home, health, and vehicle are adequately insured. You’re already covered if anything were to go wrong, right? However, if you find yourself considering potential worst-case scenarios for which you’ll need more coverage than your base policy provides, perhaps you’re not adequately covered after all. If something tragic were to happen, you may have to shell out more money than you can afford, which could affect your finances drastically. Umbrella insurance was created precisely to prepare for such disastrous scenarios.

 

Umbrella insurance is a personal liability plan which covers claims in addition to regular policies like homeowner’s, auto, or watercraft insurance. How does it work, exactly? For example, if you collide with another vehicle and injure multiple passengers, you’re likely to be responsible for some, if not all, of their medical expenses, and may even face an expensive lawsuit. In this situation, you may reach your auto insurance policy’s maximum limit, and you’ll be expected to pay out any excess from your own pocket. Fortunately, an umbrella insurance policy will provide liability coverage beyond your auto policy alone.

This liability coverage may not be necessary for everyone, though it’s not merely for the rich and famous. As a general rule, umbrella insurance is useful if your assets are valued greater than the limits of your auto or homeowner’s liability coverage. The rationale behind this advice is that you should have enough insurance to cover your assets fully in the event of a serious lawsuit.

This liability coverage may not be necessary for everyone, though it’s not merely for the rich and famous. As a general rule, umbrella insurance is useful if your assets are valued greater than the limits of your auto or homeowner’s liability coverage. The rationale behind this advice is that you should have enough insurance to cover your assets fully in the event of a serious lawsuit.

It’s also worth considering that everyone is at risk of being sued, regardless of occupation, education, or financial circumstances. Basically, umbrella insurance offers peace of mind for anyone willing to pay a little extra. Also, some people are frequently engaged in riskier activities than others, making them more likely to benefit from such policies. The following are a few situations where umbrella insurance is certainly worth it.

Umbrella insurance covers not only the policy holder but also other members of the family or household. For instance, if you have a teenager who is a new driver, this insurance policy will provide coverage should you find them liable for a major or expensive accident.

It’s always wise to protect yourself against situations that can lead to devastating financial loss. If you find yourself often engaged in risky activities or if you simply want extra peace of mind, an umbrella insurance policy can help you prepare for any number of worst-cast scenarios. If you still have questions about insurance policies, or umbrella insurance in particular, we encourage you to contact us or request a free quote. We look forward to helping you protect what you value most.

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