Personal Umbrella

Do you carry this type of insurance? If so why and how did you determine the amount of coverage?

From Google…

How much of an umbrella policy should I have?

The rule of thumb for umbrella insurance is to buy as much coverage as your total net worth , factoring in assets like your home, car, investments, and even your retirement accounts. For example, if you own assets worth $1 million, then you should purchase at least $1 million in umbrella coverage.Jan 10, 2022.

Years ago, I had a workman fall doing some work on my Property.
There was a lot of doubt if the Homeowners Policy would cover it.
BTW, once you are sued, no insurance Co would sell me Umbrella till the suit was settled. These were not easy times.

We were afraid that all our savings would be wiped out.
Thankfully the insurance company settled it within my Homeowners policy.

As soon as it was settled, I bought the Umbrella Insurance.
It is especially important with your kids driving your car.

Note: since Auto is usually the biggest risk, most insurance companies will not sell you Umbrella without also having your auto.

I bought mine from my Auto Insurer. Homeowners was elsewhere.

I got it after my bicycle accident. I had no idea that my car insurance would be responsible for a lot of the medical bills. I was fortunate in that my health insurance initially covered it and negotiated the bills way down, but then they came to me to reimburse them, since it was an accident and other insurance was available. But the PIP insurance would barely cover the ER. Fortunately, I wasn’t hospitalized or I would have been out quite a bit. The whole theory is that the OTHER persons insurance would reimburse me for medical, but my lawyer told me that their insurance isn’t obligated to pay medical bills as they came it, but the amount would be factored into a settlement. It took about a year to settle, so if the medical bills exceeded my PIP, I would either have to tap my IRA to pay the bills and get reimbursed later, or get reported to collections.

And a side note - if you are over 60 and riding a bike and get hit by a car, hope and pray that the driver does NOT have Farmers insurance. Part of their algorithm for settlement is “they are going to die soon anyways.”

Anyone with a net worth over $1M should seriously consider a liability umbrella. Most lawyers in the ambulance-chasing business won’t be motivated with a much smaller potential payday than that.

Mine runs $180/yr per $!M. It’s cheap insurance.

1 Like

As I started reading this, I wondered where the joke was. I have insured a house, car, tractor but never my umbrella. I started thinking about replacement cost and used umbrellas…

Then a few seconds into the posting I realized I must be getting senile!

4 Likes

If a person has this insurance and it becomes known are they more likely to be sued?

Possibly… but what you are really paying for with a liability umbrella is a defense lawyer. And someone might decide to sue you because you DON’T have insurance and pay a lawyer an hourly rate in the hopes of settling on a relatively small amount.

Many folks have a thought-out maximum for filing an action. My personal minimum is $10K. To me it’s not worth the hassle to sue for anything less. Lawsuits are a real pain to go thru.

All said… $180/yr per million is cheap protection when you compare the risks involved.

Here is how it plays out…when you have an incident in which you get sued. The first thing the other attorney asks for is what additional coverage that you have. Then, unsurprisingly, they sue the insurance company for the maximum amount of coverage. If you have a PUP then they will sue for the amount of that coverage. There is no shortage of “victims” that want to parlay a minor incident into a lottery ticket.

While a lawyer representing an injured party can ask for the insured’s insurance carrier and contact information, they aren’t given the amount of coverage. And a jury cannot be informed of that fact nor the the amount of coverage.

As long as you and your insurance company agree on the issue of who’s at fault, you’re in pretty safe territory. But if that is not the case, things can get pretty hairy, and pretty expensive.

Does your umbrella policy cover UNDER & UNINSURED Motorists? I looked at my policy and it said “Rejected” last year and “Excluded” this year. I never rejected anything or don’t remember doing so, but noticed this year during the renewal notification.

I questioned my agent who said:
“The uninsured is really personal preference, and depends on how confident you feel about your health insurance stepping in to fill the gap-if your auto insurance is depleted. Within the UM/UIM coverage on the umbrella, there is also coverage for a fatality”

We have $250 bodily injury/$500 per accident coverage per vehicle we own. Health insurance is Medicare/Medicare Supplement.

Is adding UM/UIM coverage to the umbrella necessary? Cost is over double:
1 million umbrella no UM/UIM = $138, with $276
2 million umbrella, no UM/UIM = $204, with $484
3 million umbrella, no UM/UIM = $258, with $708

Most personal umbrella policies I’ve heard of are limited to liability exposure regarding the insured. It’s about protecting you from lawsuits, not covering things like UIM injury to yourself.

I’ve been reading what I can and find it’s so difficult to decide if adding it to umbrella is wise. Ive seen 1 out of every 6-8 cars on road have no insurance coverage at all so if something catastrophic happened a person might have to cover themselves! Many opinions are to definitely get same UM/UIM as umbrella so whats the real concensus?

What I think you want is uninsured motorist coverage on your car insurance policy. A liability umbrella does not pay you for injuries to you. It pays someone else if you are at fault in causing an injury to them. And if you are sued by them the liability umbrella will cover your legal costs.

1 Like