What Is Umbrella Insurance, and What Does It Cover?

What Is Umbrella Insurance, and What Does It Cover?

Nobody’s perfect. That’s why should obtain a liability insurance: so, you avoid financial ruin if you accidentally cause major injuries or property damage to others. Problem is, your insurance isn’t perfect, either. That’s where an umbrella insurance policy comes in.

What is umbrella insurance?

Think of umbrella insurance as a safe way to cover your assets and investments. If you’re sued for damages that exceed the liability limits of your insurance, whether it be cars, homeowners, boat insurance or some other policies, an umbrella policy helps pay what you owe.

Most umbrella insurance provides additional coverage that is not a part of your base insurance policies, such as paying out for legal fees and damages if you were to be accused of defamation: whether it be a spoken or written statement.

What does umbrella insurance cover?

Umbrella insurance covers you and members of your family against lawsuits involving injury to others and their property, also various claims such as defamation, landlord liability and false imprisonment, depending on your policy and company.

Umbrella insurance provides coverage beyond the limits of your other insurance policies, or for claims that may not be covered by liability policies. Umbrella insurance generally provides liability coverage for:

  • Injuries
  • Damage to property
  • Certain lawsuits
  • Personal liability situations

Umbrella insurance is able to cover you beyond the limits of the policies mentioned and also covers situations not covered by the other types of policies.

Umbrella Policy Coverage Examples:

Bodily injury liability refers to covering the cost of damages to another person’s body. Examples include the cost of medical bills and/or liability claims due to injuries caused by:

  • A serious automobile accident where you’re at fault
  • Harm caused to others by your dog
  • A houseguest falls down a flight of stairs and sues you for her medical bills plus pain and suffering, which ends up exceeding your homeowners insurance liability limit.
  • A neighbor’s child falls while playing in your yard

Property damage liability covers the cost of damage or loss to another person’s tangible property. Examples include the cost associated with damage to vehicles and other property due to an auto accident where you are at fault.

Owners of rental units. This coverage means that it will help protect against liability that you may face as a landlord. Examples include:

  • Someone tripping over a crack in the sidewalk of your rental property and suing you for damages
  • Your tenant’s dog biting someone and you being held responsible for the injurie

Coverage is also provided if you’re sued for:

  • Slander: An injurious spoken statement
  • Libel: An injurious written statement
  • False arrest, detention, or imprisonment
  • Malicious prosecution
  • Shock/mental anguish
  • Your teenage son gets into a car accident, and the cost of injuries to other drivers is above your auto insurance liability limit.
  • A restaurant sues you for writing a negative review online.

How does an umbrella insurance policy work?

An umbrella insurance policy helps protect your assets and your future in two important ways:

  1. Umbrella insurance may provide coverage when your homeowners, auto, and boat insurance policies limits are exhausted.
  2. Umbrella insurance provides coverage for claims that may be excluded by other liability policies including claims like false arrest, libel, slander, and liability coverage on rental units you own.

How to choose the perfect insurance agent

It’s always better to try and choose an independent agent. They often work to meet all of your insurance needs with the companies they represent, providing auto, home, renter’s, and business coverage, all in one with the best personal service. Many offer life and health insurance as well. They are considered consultants for a lifetime, as they periodically review your coverage.

If you are looking for auto insurance in Lynnwood, WA we recommend the local insurance independent agent Villa Insurance Group. We protect all aspects of your life, from your business to your autos and home, we have you covered! There are various benefit of choosing an independent agent, one of them is options. We have relationships with many top-rated carriers to give you the auto insurance coverage you need that fits your budget. Don’t wait, call us today at (425) 771-9000 or visit our Quotes Online and start saving money.

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