Should I Purchase an Umbrella Liability Policy?

Umbrella Insurance Policy is Made for Super High Class People to Cover Damage

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Buy Umbrella Insurance Policies: Why You Might Want That Extra Protection

An independent insurance agent of Ramsey and Associates in Alexandria, Va. Says that Umbrella insurance policy is made for super high class people to cover damage. And he added that his most memorable claim on an umbrella insurance policy he was involved in was made by a small business owner who had purchased a $2 million policy.

Main feature of this policy is it gives protection against unusual. Many people just assume that Umbrella insurance is only a need for rich people but surprisingly it also proves important for middle class people. For example, if there is a car insurance policy with liability coverage, person may think he has enough protection in case of an accident. But it exceeds the $100,000 or $300,000 insurance payout in case of Umbrella insurance. It provides an extra layer of insurance say $1 million or $2 million above auto insurance. Let us see following example:

  1. In New Jersey, an underinsured driver hit a policeman who was completing paperwork at a traffic stop. The driver had to pay legal fees for his defense as well as the settlement payment of $1.2 million.
  2. In Florida, after a runner accident injured mother and her 8 years old child, she was awarded with $1.76 million. 

According to one report, around 85 percent of umbrella insurance claims are related to car accidents and accidents that occur at home. Another important benefit of these policies is protection against lawsuit or for decisions you might have made as a volunteer member of a nonprofit board.

This policy also provides protection against litigation on Facebook account and twitter blogging. Taking an example, in 2009, a high school student sued four other students and their families for $3 million because of derogatory comments the other students made about her on Facebook. An umbrella policy can cover expenses related to such lawsuits.

Insurance companies provide umbrella policy as below:

  1. $300,000 will be approved per occurrence for body injury, personal liability, and property damage liability at one’s home own.
  2. $250,000 will approved per person for body injury and $500,000 per accident with one’s car insurance policy.
  3. $100,000 will provide per accident for property damage on car insurance policy.

For an average family, $200 is not costly for an insurance coverage of $1 million insurance policy. It might be relatively low price for social security.

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