Skip to main content
Hints That You Need Personal Umbrella Liability Insurance

Hints That You Need Personal Umbrella Liability Insurance

By Dan Green

If you drive a car, have a pet, own a home, or do online reviews, protect yourself with umbrella insurance. Umbrella insurance kicks in where your standard insurance cuts out. It’s for the money you have today, and the money you’ll earn for the rest of your life.

What Is Umbrella Insurance?

Umbrella insurance is insurance that pays out after the limits have been reached on your other insurance policies, such as your homeowners insurance or your auto insurance .

Umbrella insurance is like the spare gallon of gas that you keep in your car, just in case. You may never need it, but when you do, you’ll be glad you have it.

Umbrella insurance is a generic term. Different insurance companies call it by different names.

Some of the common names for umbrella insurance are:

Regardless of what you call it, umbrella insurance provides protection for the money you have today, and the money you’ll earn tomorrow.

When you’re covered with umbrella insurance, your money is protected from injuries you cause to others; from property damage; and, from lawsuits and more.

Umbrella insurance kicks in where you other insurance coverage gives out. And, because it’s cheap, it’s an insurance policy everyone should think about having.

Add Umbrella Insurance To Your Life

Click for Your Quotes

Umbrella Insurance Is For People Of All Income

Insurance is protection against loss and damage. When something goes wrong, it pays cash to you. Insurance makes catastrophe less catastrophic.

Having a good insurance plan is important for your strong future, and umbrella insurance should be a part of every person’s plan for insurance.

Umbrella insurance protects the valuable things you own from lawsuits and claims from accidents you’ve caused. It protects money you haven’t earned yet, as well.

It’s why “I don’t have any money to protect” becomes a bad reason for not taking umbrella insurance. If you plan to work a job in the future, you most definitely have money to protect.

Umbrella policies protect against wage garnishment.

Wage garnishment is when a judge orders money to be taken from a person’s paycheck until a specific debt is repaid is full.

If you’re sued for $1 million dollars, for how long would your wages have to be garnished? Years, decades, and maybe for the rest of your life.

Because they tend to cost less than $175 per year for $1 million in coverage, umbrella insurance policies are a smart, defensive play for pretty much everyone.

Drive A Car? Have An Umbrella Insurance Policy

Umbrella insurance is a back-up insurance policy. It comes into play only after you’ve reached the limits of what your other insurance policies cover.

As an example, let’s take a look at why drivers should have an umbrella insurance policy.

Let’s say you’re driving and lose control of your car briefly. In that split-second, your car strikes another car, careens off the road through a fence, and strikes a building, damaging its foundation.

The driver of the other car is thrown from the car and badly hurt, requiring surgery and months of physical therapy. The fence is ruined and must be replaced. The building requires major repair before it can be occupied again.

Your injuries are pretty terrible, as well.

You have auto insurance and that will pay for a lot of the damage you’ve caused, which is good. But, your auto insurance won’t pay for all of the damage you’ve caused. Auto insurance coverage only takes you so far.

This is where umbrella insurance kicks in.

Umbrella insurance pays out to the driver of the other car for medical bills and lost wages; to the owner of the building for fence repair and structural damage; and, to the other parties harmed in the accident.

It’s common to have umbrella insurance for $1 million, $3 million, or $5 million to protect against events like this. Without the insurance, you could lose your car, your home, and a large percentage of your future wages.

If you drive a car, umbrella insurance will protect your future life.

Click here for an umbrella insurance quote.

10 Types Of People Who Should Have Umbrella Insurance

Umbrella insurance extends beyond just “driving a car”. When you own a home, have children or pets, or volunteer with a non-profit, among other things, it’s good to be protected.

Even renters should be protected.

Here’s a list of ten groups of people who should be insured with an umbrella policy. Coverage is available in amounts of $1 million, $3 million, or $5 million.

Umbrella policies are cheap, relative to the money they insure against. A million-dollar policy tends to cost around $12 per month.

Shop for the cheapest personal umbrella policies.

1. People who drive cars or boats

Umbrella insurance protects you from the costs of a car or boat accident, when you’re the driver at-fault.

It pays for extensive property damage, plus the medical bills of the other driver(s) and passengers once your existing auto or boat insurance policy caps out.

2. People who coach youth sports

Coaching youth sports can be rewarded, and it also comes with liability. Umbrella insurance protects you from claims brought by families on behalf of their children.

A proper umbrella policy can protect youth sports coaches from injuries to players, player accusations, and the risks of driving players to games and practices.

3. People with dogs

If you own a dog, you’ll want umbrella insurance to protect against bites.

Dog bites make up the majority of homeowners insurance claims, and the damage caused by a dog bite can exceed six figures — especially if the victim requires reconstructive surgery and rehabilitation. Umbrella coverage provides protection from that.

Also, from your dog tearing a friend’s art or other valuable collections to shreds.

Umbrella Insurance For Pets

Get Your Free Quote!

4. People with children

Children break things. It’s what they do. It’s why it’s good to have umbrella insurance in place when you have one or more children.

When your child damages something in a public place accidentally, say, at school, your umbrella policy can cover the costs.

5. People who have guests in their home

When people fall in your home, regardless of the reason, you’re at risk for a lawsuit.

Umbrella insurance protects against this type of court action, and can help you stay solvent should a guest ever fall down stairs in your home; or, trip on a rug, as examples.

6. People who have guests outside of their home

When you own a home, you own the house and the land on which it sits. This is why umbrella insurance is so important to homeowners. If a guest is walking on your property and steps into a tree branch; or, slips on a driveway, as the homeowner, you are responsible for the person’s injuries.

Umbrella insurance protects against injuries sustained outside of your home.

7. People who own rental properties

Umbrella insurance protects against the risks you have as a landlord. For example, a person could trip on the sidewalk at your rental property and become hospitalized; or, a tenant’s dog could bite someone with you held responsible for the injury.

Real estate investors need umbrella insurance coverage.

8. People who talk about other people or businesses

What if you left an unflattering review of a business; or, made a comment on Facebook about somebody and were sued for what you wrote? It happens, and an umbrella policy can protect you. If you’re sued for libel or slander, umbrella insurance can pay for your defense, and pay for your damages.

9. People who volunteer

If you volunteer with a non-profit organization, protect yourself with an umbrella policy. This is because, as an affiliate of the non-profit organization, you become directly or indirectly associated with its policies. If a child accidentally drowns in a pool on-site, or if a person chokes on food served by your organization, you could be held responsible for the damages.

10. People who rent ATVs, snowmobiles, and boats

As the driver of the recreational vehicle, you are responsible for damages caused to people and property; and, because the vehicles move at such high speeds, in an accident, you’ll cause a lot of damage.

Umbrella insurance protects you from the cost of an accident in a rented vehicle. Be protected with the proper coverage.

Umbrella Insurance Quotes

Get a Quote Now!

Where To Get Umbrella Insurance

Umbrella insurance is often sold as an add-on to homeowners insurance and auto insurance. However, you can also buy it separately.

Compare insurance companies and shop for your best value. Insurers will offer discounts when you purchase two or more policies, and the rate you get from your current insurer may not be lowest.

Click to compare insurance quotes now.







Written by Dan Green

Dan Green is a mortgage lending expert and the founder of Growella. Prior to Growella, Dan was a six-time, top-producing loan officer; and, ranked repeatedly among the top 1% of loan officers nationwide. Dan's home buying expertise has been in print and on TV with The Wall Street Journal, NPR, Forbes, CNBC, and others.

Dan Green Growella Headshot