What Is Personal Umbrella Insurance and Do I Need It?

“Personal Umbrella Insurance” is a policy that provides an additional layer of liability coverage over and above your underlying home and auto liability coverage limits.  Personal Umbrella coverage can protect your assets and future income in the event of a catastrophic loss.  The following are a few FAQs you should know about Personal Umbrella coverage:

1.    What is Personal Umbrella Insurance?  Personal Umbrella is a coverage that provides an additional layer of liability coverage (typically starting at $1 million in coverage limits) for claims that exceed your underlying home and auto liability insurance limits.

2.    Why should I consider Personal Umbrella coverage?  I recommend considering adding a Personal Umbrella policy when you have unique exposures (e.g. owning a swimming pool) and/or when you have assets and future income to protect from tort claims, lawsuits and/or judgments.   

3.    When might a Personal Umbrella policy offer coverage?   If you are sued or have a third-party claim against you and your home or auto liability limits are exhausted, a Personal Umbrella can cover you up to its coverage limits. 

4.    What are the requirements for purchasing a Personal Umbrella?  Typically, most insurers require that your underlying home and auto liability insurance limits be a minimum of $300,000 to $500,000 before you can qualify for a $1,000,000 umbrella policy limit.    

5.    Will a Personal Umbrella policy cover liability exposures other than home and auto?  Yes.  Generally, a Personal Umbrella policy will coverage exposures from your use of boats, motorcycles or recreational vehicles as long as those exposures have underlying liability coverage and those policies are listed on the Personal Umbrella.      

If you have additional questions regarding Personal Umbrella Insurance, please stop by my offices in McKinney, Texas or give me a call at (972) 727-9111.

Stan Polk, CPCU – Agency Owner

6951 Virginia Parkway, Suite 316

McKinney, Texas 75071

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I am a Farmers® agent but my posts are my own and are not statements by or on behalf of Farmers.