Personal Umbrella Policy

Most people are familiar with basic kinds of insurance policies such as car insurance, homeowners insurance, health insurance and life insurance. Among the less popular insurance policies is a personal umbrella policy, and regardless of this it could be useful within a number of situations that will help you prepare for the unexpected. None of us wants to be sued, however it can happen to anybody and the financial judgments can easily exceed the coverage limits in your home or auto insurance policy.

What exactly is a Personal Umbrella Policy?

So what exactly is a personal umbrella policy, you might be wondering? To put it simply, an umbrella can close the coverage gap and protect your assets where an auto or homeowners insurance falls short. It is a way for insured individuals to receive additional protection and coverage above the limits on almost all their personal policies. The coverage can even extend to provide protection for other financially crippling liability claims that could not be protected by your other insurance policies including defamation of character, libel and slander.

Case Examples of Umbrella Insurance

For you to obtain a better understanding behind the concept of a personal umbrella policy, we can look at a few examples of what the policy will cover in the real world.

• Our first case example we will demonstrate how a personal umbrella policy can protect you in a severe auto accident. While driving your car to work you lose control of the vehicle and cause serious injury to a number of people. The entire medical expenses for every individual you seriously injured come to roughly $900,000 unfortunately your auto insurance policy only covers $600,000. At this point your umbrella takes over to pay for the additional $300,000.
• For a second case example we demonstrate how a personal umbrella policy can protect you in lawsuit. Let us imagine you own a nice swing-set for your children and it is in your backyard. Furthermore there is no fencing or any other confinement around it and the next door neighbor kids are playing on your swing-set. One of the kids accidentally falls on their head and is seriously injured, and is taken to the emergency room for medical care. Not only are the medical costs huge, but you are in addition sued by the kids parent for negligence in leaving the swing set unprotected as well as unattended. You lose big time in the courtroom, and the parents are awarded $500,000. Your homeowner’s insurance policy only covers you up to $250,000. Fortunate for you, your personal umbrella policy will pay the other half of the judgment.

In any of the previously mentioned circumstances, if you did not have a personal umbrella policy, you would need to come up with another way to cover the gap. In most cases your personal assets would be at high-risk of being taken to pay for the judgment against you.

Internet Defamation of Character

A personal umbrella policy is not only for accidents, it can protect you in case you are accused of defamation of character, libel or slander at work or on the Internet. For example, if you have a habit of submitting posts without thinking them through on social networking sites such as your blog page, twitter posts, or Facebook, and if that post injures a person’s good name or business reputation, you might want to consider purchasing personal injury coverage via a personal umbrella policy. The policy would only go into effect after your home insurance coverage is depleted, however the majority of home insurance policies do not provide protection for defamation claims. An umbrella policy does NOT include deliberate actions, business liability, or punitive damage, which means you have to be mindful of that when considering this kind of policy.

Do You Really Need a Personal Umbrella Policy?

So you might ask yourself, do you need a personal umbrella policy? That is a question you will need to answer yourself depending on your circumstances in everyday life. Generally, the average person does not possess a umbrella insurance. Those who do have a policy typically have a great deal to lose or important assets.

Regardless of the fact a personal umbrella policy is not only for the wealthy. Virtually any insured individual having major savings or investments would be best serviced with an umbrella policy. The cost is relatively inexpensive and will protect your property and assets from liquidation.

A Personal umbrella policy could be a smart financial tool if used properly and it is imperative that you review your financial situation to determine if the extra expense would be beneficial to you. If you decide to look into obtaining a policy, Alpine Insurance Agency is an excellent place to start for a personal umbrella policy quote.