by: Aaron Whitaker
Accidents happen and, unfortunately, in some cases fault can be assigned to one or more of the individuals involved. Hopefully fault for any major accident has never been assigned to you, but if it has, then you know exactly how it feels to have that moment of panic trying to remember if you have enough insurance. Even minor accidents can be blown out of proportion these days.
An umbrella isn’t just a portable canopy you use when it rains, it’s what you need to protect you when life rains down on you. Umbrella policies cover liability in excess of your underlying personal lines policies. It’s the coverage stacked onto your current liability. Say you have a $300,000 liability limit on your home policy, by adding a $1,000,000 liability limit umbrella policy, you now have $1,300,000 in liability coverage available in the event of a covered loss.
Most carriers offer a discount on your home and auto by writing an umbrella. On top of the discount, umbrella policies are often relatively inexpensive, especially considering the amount of coverage provided by the policy. Umbrella policies are an essential part of any insurance portfolio, offering peace of mind and security knowing that you have excess liability coverage.
Liability is a funny thing, and can quickly balloon into an enormous settlement in the event of an accident. In the worst accidents, it can go well past the liability limit carried by most on their home, auto, etc. policies. I’ve read so many news stories showing the value of umbrella policies, even back to Bill Clinton, whose personal umbrella policy paid out for his legal fees when he was sued for slander back in his presidency.
In a practical sense, an umbrella policy can save you from a lifetime of financial responsibility. Anyone with a pool or trampoline at their home should especially consider an umbrella policy due to the increased liability exposure. Most people have heard stories about, or personally experienced, accidents near or in the pool and on the trampoline. If it’s not your kid getting hurt, you could very well be liable.
Your umbrella limit should match or exceed your net worth. If you think someone will go after all you have, given the chance, think again. Even if you only have friends over, when hospital bills and money get involved those friendships can quickly be brushed aside. Umbrellas are about extending your liability protection with an aggregate limit, over all of your underlying policies.
Litigation is a growing part of our society. Don’t get caught unprepared when the rain of life starts to fall. Many carriers offer umbrella policies, and any agent should be happy to quote you one. Umbrella policies are about protecting your assets from the worst case scenario. You may never want to use your umbrella policy, but it’s definitely better to have it and not need it rather than to find out you need it and don’t have a policy.
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About the author:
Aaron Whitaker joined Whitaker-LaChance in 2014 as a Personal Insurance Customer Service Representative. He brought with him extensive customer service experience from working in a retail professional camera store and computer electronic store for three years in Chicago. Aaron manages all personal insurance placement, marketing, account service and claim management. His expertise is in working with our clients to make sure their insurance program takes care of them through all the changes in life. Aaron is a graduate of Kalamazoo Home School Association and attended Columbia College in Chicago, where he studied Graphic Art Design. He is an avid photographer and enjoys fishing.