Liability coverage is included in most types of insurance, such as homeowner’s insurance, renter’s insurance, and auto insurance. What do you do if your liability insurance is not enough to pay for claims made against you or your family members? This is where umbrella insurance comes in.
What is umbrella insurance?
Most people who have heard about insurance know what liability insurance is, but what exactly is umbrella insurance? Umbrella insurance is an extra type of liability insurance. If you have a house, car, boat, or other things that require insurance, you most likely have insurance to cover those.
If you are in an accident caused by something you did and the damages or cost of the claims are higher than your liability insurance, then umbrella insurance steps in to cover the rest of the expenses so that you don’t have to.
The same applies to home insurance. If something happens on your property to another person and the costs are higher than what your home insurance will cover, then your umbrella insurance helps cover the rest of the costs. There are many more examples, but you get the idea.
Who benefits most from umbrella insurance?
Umbrella insurance sounds like a wise idea, but not everyone needs it. If not everyone needs umbrella insurance, then who is umbrella insurance for?
Many factors affect whether or not umbrella insurance is right for you. The most decisive factor is your net worth. A helpful rule of thumb is if your net worth is over $500,000, then it might be a smart idea to have umbrella insurance. This is because the more money you have, the more likely you are to end up with a lawsuit.
If you want to see if umbrella insurance is right, contact us at Hamilton Fox & Company Inc. in Pinecrest, FL. We will be happy to provide more information or give you a quote.