A Personal Umbrella for a Rainy Day or Lawsuit

We all experience “rainy days” in life—days when it seems that everything is raining down on you, whether it’s a sick child, a broken-down car, or a late mortgage payment.

But what do you do when that torrential downpour comes in the form of a lawsuit?

In today’s litigious society, average, everyday people are finding themselves at the center of legal proceedings related to car or boating accidents or injuries sustained by visitors while on their property. These types of lawsuits can result in litigation and potential judgments in the thousands and millions of dollars.

Your primary auto, home-owners and boat-owners insurance policies may provide substantial liability insurance coverage, but it may not be enough. That’s where a personal liability umbrella policy comes in. This type of policy provides additional liability coverage at an affordable price.

What Is an Umbrella Policy?

A personal liability umbrella policy provides additional layers of liability coverage on top of the liability coverage of your underlying policy. Personal umbrella coverage amounts typically begin at one million dollars and can be increased in increments of one million dollars.

Here’s an example of how an umbrella policy might work for you. Let’s say that your car is insured for liability with limits of $250,000 per person. One day, you pull into an intersection, strike another vehicle and severely injure the other driver.

The other driver sues you, and the judgment against you totals $800,000. Your auto policy will pay the first $250,000, but an umbrella policy would cover the remaining $550,000.

Umbrella policies also insure against some losses for which there is no coverage in the underlying policy, for example in cases involving libel, slander and defamation of character.

Why Have an Umbrella Policy?

Personal liability umbrella policies provide greater liability coverage for an affordable premium. This type of policy can help protect your assets. Most importantly, an umbrella policy gives you the peace of mind to know that your family is financially secure.

Consult with an insurance agent to find out more about umbrella policies and the affordable protection that they provide.

About the Author

Audrey McFarlin is a State Farm® agent. Contact her 24 hours, seven days a week, by phone or e-mail at 708-371-3555, www.audreymcfarlin.com or audrey@audreymcfarlin.com.

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