Over our many years of walking through life with our clients here at Financial Focus, we have seen many unexpected events happen. We were reminded of this yet again last week by a phone call from a client that had a medical emergency which caused a devastating car accident. Fortunately, this client has the peace of mind of owning a significant umbrella liability policy.
An umbrella liability policy is a type of insurance coverage that provides additional protection beyond the limits of your existing insurance policies. It offers an extra layer of coverage that can help you avoid financial losses if you are sued for damages that exceed the limits of your primary insurance policies. There are several compelling reasons why you should consider getting an umbrella liability policy.
First and foremost, an umbrella liability policy provides additional coverage. This means that if you are found responsible for damages that exceed the limits of your primary insurance policies, your umbrella policy will kick in to cover the remaining costs. This can be especially important if you are sued for a large amount of money, as it can help protect your assets and savings from being depleted to pay for the damages.
Second, an umbrella liability policy can provide coverage for a wide range of risks. While your primary insurance policies may provide coverage for specific types of risks, an umbrella policy can provide coverage for a broader range of risks, including those that may not be covered by your other policies. For example, an umbrella policy can provide coverage for libel and slander, defamation, and invasion of privacy, which may not be covered by your homeowner's or auto insurance policies. Keep in mind it does not cover business liability.
Third, an umbrella liability policy is relatively affordable. The cost of an umbrella policy will depend on several factors, including your level of risk and the amount of coverage you need. However, in many cases, the cost of an umbrella policy is relatively low compared to the amount of coverage it provides. This means that you can get additional protection without breaking the bank.
Finally, an umbrella liability policy can provide peace of mind. Knowing that you have additional coverage in place can help you feel more secure in the knowledge that you are protected against unexpected events. Typically, you should contact your auto or homeowner insurance agent to review the options, determine the amount of coverage you need and to get the best possible rates.
As always please reach out to your Financial Focus financial planner with any questions.