Umbrella Insurance – sounds familiar, doesn’t it? Many of us may have heard of this at one point or the other though most of us may know not much or anything about it. As the name itself indicates, the umbrella insurance protects an individual in times of legal troubles similar to an umbrella which protects one during a downpour. Well, it is a very beneficial insurance policy covering many areas which the home insurance or the auto insurance policies do not. Another noteworthy feature of Umbrella Insurance is that it is advantageous over so many other insurance policies as even after the exhaustion of an individual’s regular policy it fills in the gaps in coverage.
It is a common knowledge that at no point of time any of us can foresee what might happen in the near or far future. There are so many instances wherein you or I have to face a lawsuit filed against us. For instance, you happen to injure someone with your car. He sues you for it and the legal expenses and the judgment costs levied on you exceed your auto insurance. Then, umbrella insurance comes to your rescue.
If you purchase the policy you can face such unforeseen situations without having to lose any of your personal assets. Though many people mistake it as an extra liability, it is not. Umbrella insurance comes to one’s rescue in case if he is sued for a thing not covered by his home insurance or auto insurance.
The individual can select the amount of coverage after carefully calculating the worth of the assets he owns. For instance, if you have personal assets worth, say, a million dollars you have to go for a million dollar umbrella. Similar to an umbrella, it is also cheap. With just as little an amount as $120 dollars one can purchase as high as one million dollars of excess liability. Considering these two points, many individuals go for buying an umbrella policy the cost of which is far more than the actual worth of their personal assets. The excess liability provides protection for many things such as imprisonment, defamation, invasion of privacy and many more that have nothing to do with the car or home you own.
One important point worth considering is that an individual needs to maintain a certain amount of liability on his home and auto policies before seeking to purchase the umbrella policy.