Don’t Forget an Umbrella (Policy)Umbrella insurance can be one of the most cost-effective ways to protect your assets but is sometimes overlooked.
How Does Umbrella Insurance Work?
Umbrella insurance is a policy that covers you from a broad range of potential liabilities. It goes beyond other liability coverages you have, including home and auto policies, to cover large legal judgments.
For example, let’s say you were found liable for a multi-car accident and owe $500,000 for damage to the other cars and for the other drivers’ medical bills. If your auto policy had a $300,000 liability limit, you would have to pay the remaining $200,000 on your own. If you had an umbrella policy with a $1 million limit, the insurance company would cover the $200,000 difference.