What Homeowners Should Know About Personal Umbrella Policies

As a homeowner, protecting your assets and ensuring financial security is paramount. One way to achieve this is through a personal umbrella policy. This type of insurance can offer an extra layer of liability coverage beyond the limits of your standard homeowners, auto or boat insurance policies.

Understanding Personal Umbrella Policies

A personal umbrella policy is activated once the liability limits of your existing insurance policies are reached. For example, if you are held responsible for a car accident and the damage surpasses your auto insurance coverage, your umbrella policy can help cover the extra expenses. This can include legal fees, third-party medical bills and other costs that might arise from a lawsuit.

Why You Might Need an Umbrella Policy

You may want to consider umbrella insurance for the following reasons:

• High net worth—If you have significant assets, an umbrella policy helps protect them from being seized in a lawsuit.

• Risk exposure—Additional coverage may benefit homeowners with certain risk factors, such as owning a swimming pool or trampoline.

• Peace of mind—Knowing you have extra financial protection can allow you to enjoy your assets without constant worry.

Key Features of Umbrella Policies

The following are typical features of umbrella policies:

• Coverage limits—Umbrella policies typically offer coverage starting at $1 million, with higher limits available.

• Affordable premiums—Umbrella policies are generally affordable despite the high coverage limits.

• Broad coverage—These policies cover a wide range of incidents, including defamation, false arrest and rental property liability.

How to Obtain an Umbrella Policy

You usually need to have specific minimum liability coverage on your existing policies to get an umbrella policy. Consult an insurance broker to determine appropriate coverage and to ensure all your policies work together seamlessly.

Learn More

A personal umbrella policy can be a valuable addition to your insurance portfolio, offering extensive protection at a relatively low cost. It’s a smart move for homeowners looking to safeguard their financial future. Contact Freedom Auto Insurance to discuss your personal insurance portfolio today.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.