Umbrella Policies

Consider This Scenario

You’ve worked hard your whole life and amassed a comfortable estate. Your retirement savings, your house and car plus other investments may approach or even exceed a million dollars. That’s the good news. The less than good news may come about in a variety of risk exposures. For instance:

While driving, you are momentarily distracted, run a stop sign and broadside another vehicle. Fortunately, you’re not badly hurt, and the damage to your car is well within the limits of your auto insurance coverage. Regrettably, passengers in the other car involved in the crash are three neurosurgeons returning from a conference each suffering serious injuries as well as significant damage to their luxury vehicle.

The impact (forgive the expression) for you may result in being liable for the surgeons’ medical bills and lost compensation while unable to work after the accident – perhaps permanently.

But you say, “I carry auto insurance.” Of course you do — probably one that covers the first $250,000 or so. But in this disastrous set of circumstances, you’re responsible for about a million dollars in damages. That means you’re on the hook for the remaining $750,000!

Your financial salvation: an umbrella insurance policy. This coverage becomes your safety net to protect your hard-earned assets. When your protection limits on your automobile and homeowners policies are exhausted, umbrella insurance picks up the slack and pays the difference between what your primary insurance covers and what you still owe. That’s why it is often called Excess Liability Insurance, delivering emotional relief that your lifetime wealth creation is not wiped out by a single ill-fated accident.

Here Are Answers To Your Questions

You’re in the right place to find all that you need to get affordable umbrella insurance coverage.

Another plus: enjoy peace of mind knowing you’ll be served by proven professionals backed by dedicated resources of a local, independently owned insurance agency.

That means access to a vast array of umbrella insurance companies to match your unique needs, even if you are on a limited budget. Together, we’ll analyze your requirements and match solutions that work for you, always with an eye to maximize your protection and minimize your cost — just as we have successfully served hundreds of Virginians.

What Umbrella Insurance Covers

An umbrella policy kicks in when you reach the limit on the underlying liability coverage in your homeowners, renters, condo, auto, or watercraft policy. Additionally, you will enjoy coverage for things such as libel and slander.

Here’s a rundown. For the specifics, be sure to contact All Coverage Insurance.

• Bodily Injury
• Property Damage
• Legal Fees
• Other Legal Damages

Your Personal Checklist Of Risk Exposures

In this litigious society we live in, you should seriously consider umbrella insurance coverage. A financially devastating lawsuit can wipe out not only your current savings but also what you stand to earn in the future. Even if you lack the money to cover a massive settlement now, you could be stuck paying off the debt for years.

Certainly, if you engage in activities that increase your chances of being sued and/or your personal lifestyle includes any of the following, umbrella insurance should be a priority.

• Own property ... your primary/secondary residences or as a landlord
• Have significant savings or other assets
• Concerned about liability claims when you travel outside the U.S.
• Coaching kids’ sports
• Serving on the board of a nonprofit
• Own things that can lead to injury lawsuits such as pools, trampolines and dogs (check with All Coverage Insurance to make sure your breed is covered)
• Volunteering
• Regularly posting reviews of products and businesses
• Participating in sports where you could easily injure others (skiing, surfing, hunting, etc.)

Buying Umbrella Insurance – Qualifying & How Much

Your basic qualification for an insurance company to consider your request to buy umbrella insurance is that you already have auto or property insurance. Some companies will accept renters or condo insurance as well. Additionally, you must have a minimum amount of coverage which varies by company. (check with All Coverage Insurance for minimums that fit your needs for both auto insurance and homeowners insurance.)

How much umbrella insurance do you need?

Ideally buy at least enough umbrella insurance to cover your net worth. This includes your savings, other assets and income. You may also want to include potential income if you’re likely to earn much more in the future than you do now. Since you have no idea how much a worst-case lawsuit may set you back, it’s tough to pin down exactly how much umbrella insurance is the “right” amount. That said, umbrella policies typically start at $1 million in coverage and thereafter sell in million dollar increments … so you’ll be pretty well protected wherever you choose to start with your coverage.

Pricing

Your premium for an umbrella insurance policy may be less expensive if the policy is purchased from the same insurer that provides your original auto, home or watercraft insurance.

There are a number of factors that go into determining your umbrella insurance premium costs (the total price you pay for your policy).

We’ll work with you to put together a plan to maximize your protection and minimize your costs. For help contact All Coverage Insurance.

As a rule-of-thumb, anticipate an annual premium of about $150 to $300 per year to buy a $1 million personal umbrella liability policy. The next million will cost about $75 – and $50 for every million after that. Here are some factors that could affect the amount you pay:

• Your job
• Your hobbies
• Your pets
• Your driving record
• Previous lawsuits