How does umbrella insurance work?

How does umbrella insurance work?

April 20, 2022

You’ve probably heard of it, but how does umbrella insurance work? Umbrella insurance works for you as an extra layer of protection. It kicks in when your base liability limits on your home or car insurance have been reached. Umbrella insurance supplies a million-dollar liability or more over and above your other policy liability limits for not only you, but members of your family or household too.  And if you own rental property, umbrella insurance provides liability coverage beyond what your landlord policy covers. 

Let’s look at a real-life scenario where umbrella insurance can provide you with the protection you need. Let's say you're driving to work and you get in an accident. And the two people in the other car get hurt. That can lead to expensive medical bills and possibly legal action increasing the cost beyond what your auto insurance limits can cover. This is just one example where umbrella insurance can help protect you.

Is there anything an umbrella policy won't cover? Yes. Like most insurance, there are some limitations. Here’s a list of common occurrences not covered by umbrella insurance: 

  • Your own injuries  
  • Damage to your own property 
  • Business losses 
  • Intentional criminal acts 
  • Written or oral contracts 

Not only does it provide added coverage, but best of all, umbrella insurance is very reasonably priced. Many times, you can have substantial coverage for less than two dollars a day.  

Want to add an umbrella policy to your insurance portfolio? Contact us to see how we can bundle it with your existing policies to save you money and get you the best coverage.