What Is An Umbrella Policy?

FCIS Insurance Insurance & Claims

Umbrella insurance is a type of personal liability insurance that can come in handy when you are found liable for a claim that exceeds what your homeowner’s insurance or auto insurance will cover. What exactly does that mean? Below is a list of specific things that an Umbrella policy can cover. 

A common misconception

Despite the fact that it’s called an umbrella policy. This policy is not a catch-all policy that will cover all the things that your primary insurance doesn’t.

What it covers

  • Another’s medical bills and funeral costs
  • Another’s property damage
  • Lawsuits that involve slander, libel, defamation of character, and personal attacks 
  • Your legal defense costs
  • Malicious prosecution 
  • Wrongful entry
  • Invasion of privacy 
  • Your assets 
  • Your family’s assets

What it doesn’t cover 

  • Malpractice lawsuits
  • Workers comp
  • Damage caused by any business-related activities 
  • Damage that you caused intentionally
  • Your own injuries 
  • Damage to your personal belongings 

Keep in mind…

In order to qualify for Umbrella insurance, you must have auto or property insurance. You must also have a minimum amount of auto and/or home insurance liability coverage.   

Do you need an Umbrella Policy? 

We live in a world where people like to sue at the drop of hat. You might not think that you’d be at risk of being sued, but you never know what might happen. The real question you must ask yourself is would you rather be safe than sorry? You can’t put a price on peace of mind. 

How much Umbrella Insurance do you need?

The general rule of an Umbrella Policy is that you should buy at least enough to cover your net worth. This includes savings and any other assets and income that you have.

Umbrella insurance is often the most misinterpreted insurance policy. Hopefully, this article has helped you to better understand the ins and outs of an Umbrella. Of course, if you have any questions about Umbrella Insurance feel free to contact one of our insurance experts!