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Insurance Explained

What’s an Umbrella Policy, and do You Need One?



Why hello there! I’m David Harriman, home and auto insurance broker extraordinaire.

One thing I’m asked very often is, “what the heck is an umbrella policy and do I need one.”

Okay, what is it? An umbrella policy is an extension of liability coverage – personal liability coverage – that goes above and beyond the limits of

bodily injury liability and property damage liability on your auto policy,

and goes above and beyond your personal liability limit on your home insurance policy.

Keep in mind that when we’re talking about liability,

this has nothing to do with damage to your car or damage to your home.

An umbrella policy’s not a catch-all for damage to you.  It’s a layer of coverage to protect you in case you get sued for damages you caused to another party.

So that’s what an umbrella policy is.

And do you need one?

It depends.

If you have a pretty high annual income or you have significant net worth,

and by significant net worth we’re not talking millions and millions of dollars.

We could be talking about hundreds of thousands of dollars in net worth,

which could include equity in your primary home

or investment properties that are in your individual name.

Things like that would all make you a good candidate for umbrella insurance.

If you would like to know more please give me a call.

Thank you so much and have a wonderful day.

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