What is Umbrella Insurance?
Umbrella insurance is supplemental coverage that extends protection beyond the existing limits of your other insurance policies. It provides an added layer of liability protection for injuries, property damage, certain lawsuits, and personal liability situations that could otherwise leave you financially exposed.
How Does an Umbrella Insurance Policy Work?
An umbrella policy helps protect your assets and your financial future by mitigating risk in two distinct ways.
Extends Coverage Beyond Policy Limits
Umbrella insurance provides additional liability protection once the limits of your auto, homeowners, motorcycle, recreational vehicle, or boat insurance policies have been exhausted.
Covers Claims Other Policies Exclude
It also provides coverage for certain claims that standard liability policies may not address - including false arrest, libel, slander, and liability associated with rental units you own.
What Does Umbrella Insurance Cover?
Umbrella insurance provides protection beyond the limits of your other policies, or for claims those policies may not cover at all. Broadly, it offers liability coverage in four key areas.
Bodily Injury Liability
Covers injuries sustained by another person as a result of an accident - including medical costs and liability claims arising from situations such as:
- A serious auto accident where you're found at fault
- Harm caused to others by your dog (restrictions and exclusions may apply)
- A guest falling and being injured in your home
- A neighbor's child getting hurt while playing in your yard
Property Damage Liability
Covers the cost of damage or loss to another person's tangible property - such as costs associated with vehicle or property damage from an at-fault auto accident.
Landlord Liability
Helps protect property owners from liability claims tied to their rental units, including situations such as:
- Someone tripping over a sidewalk crack at your rental property and suing for damages
- A tenant's dog biting someone, with the property owner being held liable
Personal Injury Liability
Provides coverage if you're sued for non-bodily-injury claims, including:
- Slander - an injurious spoken statement
- Libel - an injurious written statement
- False arrest, detention, or imprisonment
- Malicious prosecution
- Shock or mental anguish claims
Who Needs Umbrella Insurance?
Umbrella insurance is particularly valuable for individuals with significant assets, those at higher risk of being sued, or anyone seeking added liability protection beyond what their auto or homeowners policy provides.
You May Benefit from Umbrella Coverage If You:
- Own a home, rental property, or other valuable assets
- Have a high net worth or meaningful savings to protect
- Frequently host guests or entertain at home
- Have a teen driver in your household or drive regularly
- Own a dog or have a swimming pool on your property
- Coach youth sports or volunteer regularly in community activities
- Are active on social media, where libel or slander claims can arise
It's a fair question to ask: 'Doesn't my auto or homeowners insurance already cover some of this?' In many cases, yes - but umbrella insurance extends protection above and beyond those policy limits and covers certain situations those policies don't address at all.
What's Not Covered by an Umbrella Policy?
While umbrella insurance offers broad protection, it has specific exclusions that are important to understand.
- Your own injuries or damage to your own personal property
- Criminal or intentional acts that cause damage to someone else
- Liability you've voluntarily assumed under a contract
How Umbrella Insurance Protects You - An Example
Consider a scenario where you're found at fault in a car accident, and the total cost of injuries to others reaches $500,000. If your auto insurance carries bodily injury limits of $300,000, your auto policy covers that amount - but who covers the remaining $200,000?
Your umbrella insurance policy does. It steps in to cover the amount that exceeds your auto policy's limit, up to whatever limit you've selected for your umbrella coverage.
How Much Does Umbrella Insurance Cost?
The cost of an umbrella policy depends largely on how much coverage you choose to purchase. Several other factors can also influence your premium.
An insurance specialist can help you build a policy with the right balance of coverage and cost for your specific circumstances.
Frequently Asked Questions
Expand your protection
EXTRA PROTECTION FOR THE LIFE YOU'VE BUILT.
The Fortis Insurance helps you extend your liability protection beyond standard policy limits, so a single serious claim doesn't put your assets and financial future at risk.
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