10 Myths about Auto Insurance

Do You Need Umbrella Insurance

Umbrella insurance is supplemental liability insurance, which means it’s in addition to the regular liability coverage you have on your auto, home, and/or other policies. So what does umbrella insurance do? And should you have it? Most experts recommend having at least $1 million of umbrella insurance protection, so let’s see why that might be worth the cost and effort.

Can you afford to be sued?

Many of us wouldn’t think twice about purchasing insurance coverage for our cars or homes, but oftentimes people overlook a very important kind of insurance coverage that can help protect their financial well-being: liability insurance. Liability insurance covers legal and financial expenses incurred by you if you are found legally liable for bodily injury or property damage that occurs from your actions. To legally drive a car in California, for example, you must have at least $15,000 worth of liability coverage. The same holds true for homeowners who would be held responsible if someone were to get hurt on their property; many states require them to have at least $100,000 worth of liability coverage. But what happens when we go beyond those basic requirements and look at liability in other aspects of life? In some cases, even good drivers may want to consider supplemental liability coverage so they can better protect themselves financially. It all comes down to determining how much liability insurance you need based on several factors—including your assets (both liquid and not), net worth, family situation (including whether you plan on having children), and more. So let's talk liability: How much do you really need it? It all depends... If you're asking yourself how much liability insurance do I need? start off by considering how many people could potentially come after you legally. If no one knows your name, there aren't likely to be any lawsuits coming your way... unless, of course, something catastrophic happens that causes property damage/injury to an anonymous person/people. For most Americans, these situations won't apply. Instead, most potential liability issues arise due to professional and personal relationships—family members and close friends will know where you live (and visit!) and business partners will know details about your work status.

Calculate your potential liability

Calculating your potential liability is critical to deciding how much liability insurance you’ll need. The first step in estimating your liability is to identify what assets are at risk of being taken away by a court should you be found liable for any accident or injury. These might include, for example, a house that could be foreclosed on or wages garnished. Once you have an idea of what’s at stake, figure out how much it would cost to replace these assets if they were lost through legal action. This can help you better determine how much insurance coverage you need and whether umbrella coverage makes sense. For example, if you live in California and earn $50,000 per year (about $25 per hour), multiply $25 times 40 hours per week times 50 weeks per year to equal $40,000—the equivalent salary of one full-time employee. If your employer pays half your liability insurance premiums as part of the group benefits package ($1,500), then decide how much value that provides you against a lawsuit: Simply take half of $1,500 ($750) and add it to your annual income ($50,000). That gives you a new total income: $59,750. How does that stack up against your current situation? Would it be more than enough to cover any liabilities associated with your job? What about in case of an accident on top of any liability relating to your job? If so, consider getting extra insurance so you're covered no matter what happens. But don't forget other big risks; aside from anything related to work, there's a good chance you're also financially responsible for medical bills arising from accidents caused by people visiting your home. Do they have their own medical insurance or will you pay all costs yourself? And finally, make sure your homeowner's policy covers any damages caused by renters renting rooms via Airbnb.

Separate your assets

Your assets are what you have, including your home, car, and money. Liability is what you’re responsible for in a legal sense. If someone is injured on your property, they can sue you to recover damages -- they can collect from you or your insurance company. The amount of coverage -- called liability insurance -- will depend on what state you live in, but it should be enough to cover medical bills and related expenses if someone gets hurt. If a loved one dies in an accident that was partially your fault, expect that sum to be large. If you want to know more about liability insurance and how much coverage is right for you, schedule a consultation with an insurance agent today. You don't need your own policy; he or she will guide you through several options available within different price ranges.

Some employers purchase liability insurance to cover workplace accidents, so check with yours; however, most people opt to buy their own policies as soon as possible so they're covered at all times -- not just during work hours. It's also wise to get sufficient coverage now since premiums typically rise steadily over time. Call 855-603-2675 today for a fast quote! A good umbrella policy is different from ordinary personal liability coverage because it kicks in when your regular plan reaches its limit. While you could go without additional protection, you may consider buying one if your assets are worth more than $300,000 or you have assets that aren't protected by your current plan (like income-producing property). Talk to a few agents and ask them how much additional coverage they can offer you before they require a complete list of assets, including retirement plans. With one call and 15 minutes on our website (855-603-2675), you can learn how much an umbrella policy would cost and whether it's right for you. If it isn't, we'll tell you what is -- we're here to help. When your needs change, come back to see us again because there’s always something new for us to discuss together. Schedule your consultation with one of our licensed representatives by calling us at 855-603-2675.

Discounts vary among insurers and depend upon where you live.

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Consider umbrella insurance

While there’s no magic number for how much liability insurance to carry, those who are at high risk for a lawsuit—for example, doctors and other medical professionals—often consider adding an umbrella policy to their policy portfolio. Think of an umbrella as extra liability coverage. For example, if you suffer an accident in your own home and it results in a lawsuit totaling $5 million, your homeowner’s insurance will likely cover up to that amount. If you also have a personal umbrella policy that covers $1 million in liability protection (beyond what is already covered by your homeowners or renters insurance), then you’ll have access to another $4 million in coverage. If you're worried about getting sued, an umbrella policy can be helpful. However, keep in mind that you should evaluate whether the cost of purchasing an umbrella makes sense for your particular situation.

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What can umbrella insurance cover?

If you’re in a situation where you are sued and need to use an umbrella policy, it will cover any damages beyond what your auto or home insurance covers. For example, if someone falls on your sidewalk due to poor maintenance, which leads to an ankle fracture, your homeowner’s policy will pay for medical bills and repairs, but not for lost wages. With umbrella insurance, that added liability is covered. However, it should be noted that many experts believe carrying a personal umbrella liability policy doesn’t make financial sense because of high premiums; instead, they recommend buying extra coverage when it's needed as part of a package through your provider. But having coverage can also mean avoiding lawsuits from claims like libel or slander—that one person who would rather sue than discuss things rationally might pursue legal action if threatened with exposure for false claims. So it may be worth insuring yourself against all kinds of potential scenarios. Just remember: Even with insurance, once you're dragged into court, all bets are off. The result could still be a hefty penalty. And beware of perils: Carrying enough umbrella insurance to protect yourself from catastrophic losses could result in top-level rates (or non-coverage), so find out how much each company charges for its highest amounts of coverage. Also, read your policy carefully before accepting a new job — replacing old coverage with a new employer-provided plan could nullify old policies' protection and require you to buy new ones (often at great cost).

Is umbrella insurance worth it?

There are many types of insurance out there. There is a liability, life, home, health, and much more. It may seem like you have all your bases covered by purchasing all of these different policies. However, if you haven’t considered umbrella insurance for your protection needs then you should definitely look into it now. If a claim is made against you for bodily injury or property damage that can’t be covered by your other forms of insurance (liability), an umbrella policy will payout to help cover those extra costs. Instead of worrying about incurring extra fees, let one insurance company take care of them instead with their umbrella coverage. Although most insurers do offer some sort of umbrella coverage with their liability packages you shouldn’t automatically assume that they do when looking over your options. Don’t just choose any random policy but instead get everything you need from one place so that all of your financial necessities are covered in case something does happen. Umbrella insurance is meant to fill in gaps and make sure you don't end up spending money on things not related to your incident because you didn't want to spend a little bit more on being prepared! When it comes down to it, why would you go without umbrella insurance? By getting yours today you could potentially save yourself thousands down the road while also enjoying peace of mind knowing that you are protected by an excellent company that knows how to stand behind their work and give back even when things aren’t going perfectly. Ask yourself what your worst-case scenario is and see if having umbrella insurance would help alleviate some worries - chances are you won't regret investing in this essential type of protection at all. After asking yourself why your insurance might not give as much coverage as possible go ahead and order a policy today - compare prices around before making a decision though so that you aren't ending up paying too much.

When should you buy umbrella insurance?

When you carry umbrella insurance, it means that if your liability limits are exceeded in a single event or series of events, an umbrella policy will kick in and provide additional coverage. So what does that mean for you as a policyholder? More protection at less cost than you would otherwise have if you didn't purchase an umbrella policy. That's why we recommend all of our clients to have one. It provides more coverage at less cost while allowing your liability limits to be lower – sometimes even waived - because they are covered by your umbrella policy. An umbrella policy is probably more important than car insurance! This is because just like auto accidents can cause substantial injuries, lawsuits can result in substantial claims payments when a person feels they have been injured and deserve compensation for their pain and suffering. Though many states mandate car insurance coverages, there is no federal law requiring people to maintain personal injury liability coverages on their assets. However, most credit card companies require customers to have some form of personal injury coverage in case someone else makes a claim against them due to negligence (when you do something wrong and hurt another person).