Over the years you have worked very hard to save for retirement, own your own home, and have a car or two. All of these are related to your family’s financial future and security, but it all could be at risk as a result of an accident or liability lawsuit. If you have assets to protect, it is essential you buy an umbrella policy to cover your home and auto insurance policies—and rates are lower than you may think! Unexpected claims can arise from many different circumstances. An umbrella policy covers a wide variety of liability situations and is protection you should seriously consider.
An Umbrella Policy works by protecting you over and above your auto and homeowners policies. If you were to cause a major auto accident or extensive injuries to other parties, your hard earned assets could be at risk. The total cost of the damages, injuries to other parties, and lawsuits could quickly and easily exceed the limits of your auto insurance. This is where an Umbrella policy kicks in and is considered added protection to what you already have. Lets say you get into a car accident, you’re sued, and your auto policy only covers you for an amount of $100,000, but the damages total $250,000. If you have an Umbrella policy the remaining $150,000 gets paid and the policy holder is not left in a financial hardship.
Another way an Umbrella Policy works is if a person faces a homeowner’s claim due to bodily injury. For example, you decided to host a graduation party and someone slips, falls, and is injured. You might think you will not get sued, but in today’s society, lawsuits are both common and costly. It could potentially destroy your financial security.
Accidents like these can and do happen to people every day, even if we try to avoid them. This is why an Umbrella policy may be all there is to keep a person and his or her assets protected and free from complete financial ruin.