Understanding Umbrella Insurance
Introduction
An umbrella policy provides extra liability coverage that goes beyond the policy limits of other policies, such as extra protection for one’s existing auto insurance, home insurance, RV insurance, and more. For instance, if existing liability coverage isn’t enough to fully pay for someone’s damages for which you are at fault, whether from a motor vehicle accident or some kind of mishap in your home, this is where umbrella coverage provides significant assistance. In short, a good umbrella insurance policy is utilized to prevent the policyholder from having to pay out-of-pocket. When considering obtaining this kind of coverage, it’s a good idea to figure out how much coverage might be desired and if it is for personal and/or commercial purposes.
Who Benefits
Anyone can be helped by an umbrella policy as it is engineered to mitigate often costly out-of-pocket insurance claims. If you have other existing policies, it can be a great idea to obtain such a custom policy.
An Example
To better illustrate, say you are involved in an accident and your standard policy liability property damage level is $20,000 but the accident ends up totaling $30,000 in damages. Without umbrella coverage, you would be responsible for the remaining $10,000. The umbrella policy handles the balance of the $10,000, saving you from having to somehow come up with a potentially bank account busting sum.
Conclusion
At the end of the day, it is important to consider the ways you can protect you and your family’s financial futures. This coverage provides the peace of mind in knowing that you won’t face the problem of having an accident or event in which you wouldn’t have the ability to pay whatever is necessary. An umbrella policy is a relatively affordable method to carry coverage that fills in the gaps left with all of your other existing policies.