Skip to main content

Umbrella Insurance: What Is It, & Do I Need It?

By December 27, 2015June 9th, 2020Liability Insurance

What is it?
Umbrella liability insurance provides additional liability coverage in excess of your Homeowners’ Personal Liability, Auto Liability, Boat Liability, and other liability policies. When your under-lying policy limits are exhausted, this is where the Umbrella policy kicks in. It’s there to help protect you from large liability claims and lawsuits, in order to protect your assets and future.

Umbrella policies also provide drop-down coverage for claims that might be excluded on other liability policies you have, such as false arrest, libel, & slander. To identify places where your Umbrella policy might “drop down” it is important to review the different Umbrella policies available with your agent.

Do I need it?
Let’s face it: we live in a litigious society where large lawsuits are all too frequent. If you are older, a large lawsuit could take away the earnings you’ve worked so hard to obtain. If you are younger, a claimant could sue for the right to your future wages. Basically anybody that owns property or vehicles has a need for Umbrella coverage.

Can I afford it?
The short answer is yes. Depending on the number of property & vehicles you own and your past claims history, premiums can be as low as $20-30/month. Most of our Auto carriers offer Umbrella policies, and we have some other markets that offer stand alone coverage as well.

Real life examples
To give you some real life examples, we have provided some actual claims that one of our carriers, RLI, has provided coverage for:

  • An insured was rear-ended on a highway and ended up running into a road barrier and light pole. The insured suffered broken ribs, lung contusions, and head lacerations. The other driver was cited, but had no insurance. Luckily the insured had a Umbrella policy with Uninsured Motorist coverage. The policy ended out paying over $260k in medical expenses to the insured.
  • An insured was driving near a construction zone when they were rear-ended by the at fault party. The insured had broken ribs, contusions to the lungs, and head lacerations. The other driver was cited with multiple violations, but did not have adequate insurance. The insured’s Auto policy paid out policy limits. Since the insured opted to have Uninsured Motorist covered on their Umbrella policy, they were able to pay the $260,000 in extra medical costs
  • An insured hired a contractor to replace the dock behind his house. The contractor advised that a tree needed to be removed in order for the work to start. The insured decided to remove the tree by himself, and in the process a limb struck the contractor in the head. The Homeowners policy paid out up to its max Personal Liability limits. The Umbrella policy picked up the remaining $800,000 that the insured was liable for.

 In Summary
Umbrella policies provide liability coverage for claims that exceed your underlying policy limits. For a relatively low premium you can protect your family, assets, and provide peace of mind.

If you have any questions, or would like us to quote coverage, please contact your agent or call 727-345-0242 or email