Umbrella coverage provides liability protection over and above the policy limits of the usual auto or homeowners insurance plan. If your existing liability coverage is not up to snuff in regards to fully providing for a wide variety of injury damage claims, (if you’re at fault), whether due to a motor vehicle accident or some kind of a mishap in your home, etc., then good umbrella insurance coverage can help one in avoiding potential financial ruin.
Keep in mind that you do not need to be wealthy to enjoy the benefits of an umbrella insurance plan. In the owning of a home and being the head of the household, one has enough reason to purchase a good umbrella insurance plan. Should one be sued for negligence or be in financial jeopardy in any number of other ways, without proper coverage everything you own, including monetary assets, can be in peril. Usually, auto or homeowners’ insurance will pay for the initial $300,000 of expenses incurred. The obvious problem is that you will be liable for any dollar amount that goes beyond the policy limit.
Good umbrella insurance coverage will also provide protection for the gaps in one’s current homeowners’ or auto insurance coverage. The following are some cases in which Umbrella Coverage can assist policyholders:
• Slander & Defamation
• Malicious Prosecution
• False arrest & imprisonment
• Mental Anguish
Having an umbrella policy, one can be helped in the appointment of a legal team on his or her behalf along with pay-outs for such expenses as court costs and for the legal representation as well. If you are found to be guilty and a judgment comes down against you for a substantial sum, umbrella coverage will help safeguard you with compensation for judgments that exceed the usual coverage.
Umbrella policies generally come in million-dollar increments. Normally, the first million dollars of umbrella coverage will equate to a $300 annual premium. Each additional $1 million of coverage will cost another $100 or so.