What do you think of when someone says umbrella policy? Maybe you aren’t familiar or it just sounds like something insurance agents are trying to sell you just so they can get another policy from you. The truth is, of course, we always appreciate more business from our existing customers, but the most important part is knowing that our customers are covered in the absolute worst-case scenario. That is what insurance is for: helping when the worst happens.
An umbrella policy is best thought about as a peace-of-mind policy. There are certain underlying limits required to qualify for an umbrella so if you have state minimum coverage, this may not be the best product for you right now. Alternatively, if you carry higher liability limits and own one or more homes you would like covered, the umbrella is designed to help you sleep better at night knowing your assets are protected against disaster.
Umbrella policies are an overlying policy on top of your other liability coverages, and it covers pretty much any kind of policy, auto, home, marine or motorcycle. For example, let’s say you have the liability limits needed to qualify to have an umbrella which would be 250/500 ($250,000 per person and $500,000 per accident) and you get into an accident. Unfortunately, this accident was your fault and that car looks pricey, now what? Without an umbrella, that other driver could sue you for a million dollars in a lawsuit, but your auto policy only covers up to $500,000 in liability, now you are responsible for that additional $500,000. That kind of thing can break families for a generation; an umbrella can help prevent that.
Now let’s look at the other side of this coin. You do have an umbrella, the accident is still your fault, and they come after you for $1,000,000 in a lawsuit. Now that you have the umbrella, your auto policy would take care of that first $500,000, the underlying limits have to be used up first, then the last $500,000 that was going to come out of your pocket or your assets, will now be picked up and taken care of by that umbrella policy. Now you have the peace of mind knowing that if the worst happens, you will still be able to hold on to the assets you have worked so hard to build because the umbrella will act as a shield to protect you. The umbrella also gives discounts on your other companion policies so it may end up nearly paying for itself just through discounts off of your other policies.
Today, we live in an increasingly litigious world and without an umbrella policy to cover you for the extreme situations, you could find yourself in a difficult spot. Let us help with that! Visit agents.farmers.com/ga/Marietta/troy-jones to learn more or contact our office for a personalized coverage review.
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