Umbrella Policies: Protection from any Storm

Umbrella Policies: Protection from any Storm

Historically, the umbrella symbolizes the canopy of the heavens: shelter and protection.

It is often an emblem of power and dignity, used as a clever contrivance in literature through the ages, and as a symbolic device in religious ceremonies around the world.

More practically, it protects one from getting wet in the rain or from getting burned by the sun.

Umbrella insurance can serve the same purpose when it’s included as part of your financial portfolio.

An additional protection, umbrella insurance goes beyond your standard insurance policies and protects the assets that make up your net worth. Umbrella policies are designed to pay in the event of a claim that exceeds the liability limits of your other policies.

The exact coverage offered varies, of course, but many umbrella policies include coverage for personal injury lawsuits arising from:

  • Slander
  • Libel
  • Defamation of character
  • False arrest, detention or imprisonment
  • Abuse of process
  • Malicious prosecution
  • Shock and mental anguish

The addition of coverage for personal injury lawsuits can be very important.

Consider the following scenario:A 14-year-old child is cyber-bullying a classmate.
The bullied classmate commits suicide.
The cyber-bullying is discovered in the deceased teen’s electronic devices.
The parents of the deceased teen sue the cyber-bully and their parents for:

  • Libel
  • Defamation of Character
  • Mental Anguish

The parents of the deceased teen win in court and are awarded $2.5 million.

Personal Injury is NOT covered under a normal homeowner’s policy, although in some instances certain carriers will let you “buy it back.”

In most cases, if you don’t have an umbrella policy, you will have no protection in this scenario.

Umbrella policies can be complicated, but offer essential, affordable protection. Call P/L/R Insurance to get the guidance you need to make sure that all your assets are protected.

Here’s why:

Even if you don’t think you have much to lose, you certainly don’t want to lose what you have – and you may be worth more than you think. At P/L/R, we can help you figure that out, too.
  • Umbrella policies are very affordable, usually only $200-$300 per year. A small price to protect everything you’ve worked for.

How much coverage do you need? At least enough to cover the value of all your assets – and remember – you may be worth more than you think. If you have $3.5 million worth of assets, why would you only protect $1 million worth?

  • Each case is different, and requires the input of an insurance professional.

Loss of future earnings is a real thing. If you’re young and haven’t accumulated many assets, you can still be sued for lots of money.

  • If you can’t pay the judgment against you, the suit could attach to future earnings and keep you paying for it for years down the road.
When discussing umbrella insurance, it’s important for your insurance professional to know all your risks. If you have more than one home and one auto, those extra items will need to be included in the “rating” of your umbrella policy, so be sure to disclose things like:
  • 4-wheelers
  • Boats
  • Jet skis
  • Multiple homes
  • Additional vehicles

Including items like these in your umbrella rating will have a negligible effect on your premium, but are important to include to ensure that you get the right coverage.

It is troubling to think that someone would try and sue you for everything you’ve got, but in our litigious society, you can’t afford to take that chance.

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