You can never have too much of a good thing. It’s a saying that applies to many things in life, including liability insurance. When the limits on your liability coverage are reached, you will be glad you invested in backup protection. Umbrella insurance is extra coverage that protects your financial interests and assets when the claims against you exceed your standard insurance coverage. Since liability claims can total hundreds of thousands, and even millions of dollars, investing in umbrella insurance could be the key to protecting your income and future wealth.
Do Middle-Class Workers Need Umbrella Insurance?
A common misconception is that umbrella insurance is only for the top one percent of income earners. The truth is nearly anyone with a job or substantial assets can benefit from umbrella insurance. When the limits on a standard insurance policy are reached, you are liable to pay any remaining claims or judgments out of your own pocket. You might be forced to liquidate your savings accounts or even sell your assets to cover the cost. If that still is not enough, a judge may allow for garnishment of your future wages until the debt is settled.
Imagine the following scenario:
Your child has a friend from school over to visit for the weekend. While playing outside one afternoon, the visiting child falls off of your trampoline, seriously injuring herself. The child needs emergency medical attention and will require surgery to repair a compound fracture. The child’s family sues you for medical bills, pain and suffering, and the caretaker’s lost wages during the recovery period. You are also sued for the child’s personal anguish, as the injury will prevent her from pursuing sports and certain types of physical labor in the future. The bodily injury liability limits on your homeowners insurance cover only the first $100,000 of damages. Unfortunately, a judge rules that you are liable for a total of $200,000 in losses. How would you pay the judgment?
Put Your Family under an Umbrella
With umbrella insurance, you do not have to worry about having enough money to cover liability claims against your family. Standard umbrella insurance provides extra liability protection, usually starting at $1 million. Additional umbrella protection is available from many carriers in increments of $1 million. Best of all, an umbrella policy can provide this added peace of mind for the average cost of a dinner out with the family each month.
When you purchase umbrella insurance, your family’s liability exposure is double-insulated against risks. It can serve as back-up protection for the bodily injury and property damage liability limits on your:
Umbrella insurance can also provide liability protection not offered by other standard insurance policies. In most cases, this includes claims of defamation, slander and libel. It can also extend to cover your liability when traveling abroad.
Umbrella Insurance in Minnesota
If you live in Blaine or the greater Twin Cities area, we recommend talking with an independent agent about your liability exposure. Here at Patriot Insurance, we help everyday workers and retirees learn about the ways they can protect their assets and income against risk. After all, it only takes one incident to wipe out a lifetime of savings. For more information about umbrella insurance or to request your free quote, contact our office today. We look forward to serving you soon.
