Umbrella insurance, also known as excess liability policy, protects you against covered claims when their limits go beyond your primary liability policy’s (home, renters, auto, or commercial insurance) limits. If you are a first-timer, you might have many questions concerning what it exactly covers, when it will come to your rescue, how much coverage you need, etc. Let us discuss them.
What Is Covered Under Umbrella Policy?
With an umbrella policy, you are covered against:
- Personal injury
- Defense costs
- Third-party bodily injury
- Wrongful eviction and entry
- Legal settlements
- Property damage
- Invasion of privacy
Why Should I Buy Umbrella Insurance?
An Umbrella policy is not mandatory by law. However, you should consider buying umbrella insurance if you have costly assets, such as a car, home, business property, and jewels, or you have an increased risk of being sued for third-party bodily injuries or property damage due to:
- Hosting parties regularly.
- Having pools, dogs, and trampolines.
- Being an inexperienced driver.
- Taking part in skiing and hunting.
- Posting reviews about businesses and products.
Without umbrella insurance, you have to pay out-of-pocket if the cost to repair/replace your pricier assets or cover liability claims fall short of your existing coverage.
When Will Umbrella Insurance Cover Me?
If you had to cover the liability claims exceeding your general liability limits, umbrella insurance would kick in to cover you, saving you from financial hardships.
For example, say you have caused a car accident and sued for $1 million. If your existing auto insurance covers only $500,000 for liability damages per incident, you will have $500,000 remaining, which your umbrella insurance will cover.
How Much Will It Cost to Buy Umbrella Insurance?
The cost of the policy depends on your coverage limit and the assets you want to cover. However, on average, an umbrella policy with $1 million coverage costs around $20 per month.
How Much Umbrella Coverage Do I Really Need?
Generally, you can find personal umbrella insurance policies with coverage limits ranging from $1 million to $10 million. However, how much coverage you should carry depends on your:
- Potential risks-
Including possibilities of at-fault accidents, bodily injuries, property damage, etc.
- Assets’ Value-
Properties, jewels, bonds, retirement savings, investments, stocks, etc.
- Current Liability Limits-
Check your existing coverage limit against the total value of your assets and buy umbrella coverage to make up the difference.
Do I Need to Buy Commercial Umbrella Insurance for My Business?
You have invested all your time and money to keep your business running smoothly. However, even one costly lawsuit could devastate your business’s continuity and operation while impacting your finances. This is where umbrella insurance will help. A commercial umbrella policy can cover lawsuits costing up to $25 million at affordable premiums, so you don’t have to worry about being sued for injuries/damages and run your business with peace of mind.
With providing extended coverage to protect you, your high-prized assets, and your family/business, umbrella insurance is surely worth-buying yet a cost-effective way to enjoy ultimate protection.
Stay Covered Against Costly Claims with Umbrella Insurance
If you are looking for affordable commercial umbrella insurance in North Carolina, contact us today at Pittman Insurance Group, LLC to get started. We will create a customized policy according to your business’s unique risk exposures and needs.