An Umbrella for Stormy Weather

All of us have the potential of experiencing “stormy weather” when it comes to insurance claims. Even careful drivers could find themselves negligent in a car accident where bodily injury claims reach staggering amounts. Although severe accidents are rare, it is advisable to “load up" on insurance coverage for our protection against liability claims from others you may injure. A good way to do this is to purchase what is referred to as an “umbrella” policy. Many think that the term “umbrella” is some mysterious all-encompassing insurance contract that will cover everything imaginable. The umbrella is merely a policy that provides excess liability insurance. It is additional insurance beyond what is provided by other policies you may have. For instance, if you have an auto policy that has $300,000 of liability limits and you purchase an umbrella for $1,000,000, your total protection is $1,300,000. The umbrella will provide excess liability over a variety of insurable interests such as auto, home and investment (non business) properties, and boats. The cost of an umbrella is surprisingly low. The premium for a $1,000,000 contract providing excess liability over two cars and a home is approximately $180 a year. Personal insurance umbrella limits are available up to $10,000,000 usually.

Umbrellas are frequently used in business insurance as well. Limits could exceed $100,000,000 for some industries where there is a possibility of catastrophic loss. Movie theatres and other businesses where a large number of people congregate in a confined space purchase high limits.

Umbrellas normally provide the same coverage found in the underlying policy and some provide expanded coverage such as automobile liability while driving in other countries.

Ask your insurance agent to design an umbrella program that is right for you.

For further information about the personal and commercial umbrella and other insurance matters contact Guy Hatfield at 203.256.5660.