Who Needs Umbrella Coverage?

Chances are you are under insured and could benefit from umbrella coverage if you:

• Own a home, assets, or retirement savings.
• Drive a car, borrow a car, or let others borrow your car.
• Host parties.
• Own rentals.
• Have children at home or students away at college.
• Assume responsibility for other peoples’ children via carpooling, babysitting, or sleepovers.
• Own animals or care for others’ animals.
• Use social media or allow their children to use social media.
• Travel abroad.
• Volunteer with a charity, serve on a board of directors, or participate in a HOA.
• Own an ATV, boat, motorcycle, golf cart, RV, watercraft or other specialty vehicle, especially if they allow others to ride in or on them or operate them.
• Share access to common areas like docks, lakes, vacant land, or rent access to these types of areas.
• Own firearms or other recreational weapons.

 
Liability comes in many forms. Here are a few of the ways you may be responsible for damages beyond what your current home and auto policies cover.
 
Auto liability:
It’s no secret that distracted driving accidents, fatalities, and the resulting medical care costs are on the rise, making higher limits more important than ever. Even relatively minor accidents can incur substantial medical bills. If an accident involves disability or death, the costs can be hundreds of thousands, or even millions, of dollars. Those with teenage drivers incur greater risk as teens are more likely to have a serious crash.
 
Do you have children?
Those with children, teen and adult children living with them can benefit from an umbrella policy, as you could be liable for injuries to others’ children during carpooling, a playdate or babysitting. Even if your child attends a party where there is an injury or death, you can be sued, even if your child did nothing wrong.
 
Do you entertain at home?
If so, you could be liable for everything from trip/fall hazards, to food poisoning, to someone drinking alcohol at your house and getting in a car accident on their way home.  A homeowner’s policy worth $300,000 won’t go very far if the courts award a $500,000 judgement against you.
 
What about pets?
While dog bites only comprise a third of all homeowner’s liability, according to the Insurance Information Institute, even friendly dogs can frighten or knock down elderly or youthful guests and cause injury.
 
Personal injury and personal offense liability.
Gossip can be hurtful. It can also result in painful lawsuits. People can be sued for embellishing an embarrassing story about someone, writing a bad review of a business, re-posting material subject to copyright laws, or even a rant on social media. In short, anyone can sue another person for any reason, frivolous or not. Regardless of the validity of the suit, you must respond.
 
Drop down protection. Do you travel overseas?
You may be at risk without realizing it. For instance, if you rent a car and have an accident, your home or auto policy probably won’t cover it. Likewise, if you rent a boat while on vacation, you are likely without protection. But an umbrella policy may provide primary liability in both situations. Further, if you are sued personally, the umbrella may cover your legal defense. A good attorney starts at $250 an hour, but with personal umbrella insurance, you could receive extended protection for less than a dollar a day.
 
You don’t have to be rich to be sued like it.
​Some people assume that since they aren’t rich, they can’t get sued since they don’t have the money to pay. However, the courts disagree. If a person is held responsible, or even partially responsible, for an accident, their wages can be garnished, their savings taken, and in some states their home and other assets seized. While financial responsibility rules vary from state to state, not having umbrella insurance exposes you to a lot of risk.
 
A personal umbrella policy is an inexpensive hedge against such risks.  Many times, umbrella insurance is available for around a dollar a day.  In short, bad things happen to good people.  The key is to do a thorough interview with your agent about your family, your lifestyle, and hobbies. He or she can use that information to determine if your risk is tangible so you can make a more informed decision about liability and umbrella insurance.
  
Article from 2/26/18 Insurance Journal - insider-tips-for-increasing-umbrella-sales
Written by Brook McGuire is the Strategy Lead for Specialty Products at Safeco Insurance.