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Umbrella Insurance

Umbrella Insurance Explained


Umbrella insurance is a type of policy that is purchased to cover one from losses not protected under standard insurance coverage. (Examples include homeowners, car or boat policies.) Good umbrella insurance coverage can found in the form of both commercial and personal policies. Most often this kind of coverage is utilized to strengthen existing car insurance.

How it Works

Umbrella insurance compensates for any leftover costs resulting from claims that exceed the usual limits of standard insurance.

Kinds of Coverage

Bodily injury umbrella policies are what pay out for liability claims and/or medical expenses from injuries to another person that might occur as a result of a car accident in which the policyholder is at fault. It also covers injuries that happen to a guest in your home or from an animal attack. It also covers you from, for example, a neighbor kid slipping, falling and getting hurt on your lawn. Property damage umbrella policies deal with any costs resulting from damage or destruction to another’s property. A pet destroying another person’s expensive fur coat or the damage done to a car in which you are at fault or even your child causing damage to school property are all examples.
There is even extra coverage for landlords to help with the management of rental dwellings. Incidents protected include a renter’s dog biting another person leading to he or she needing medical attention or a person injured as a result of some defect at a covered property.
This coverage also protects policyholders if they are sued for slander or libel, mental anguish, false arrest, and more. These policies can also provide coverage for business and professional liability. Errors and omissions is a frequently adopted type of umbrella policy used by planners for finance, real estate agents, accountants and others who have roles in providing advice. This kind of coverage protects the policyholder from claims of negligence made by those seeking damages for alleged losses resulting from error or omission in the services that the policyholder provides. Keep in mind that errors and omissions coverage won’t provide financial help for criminal prosecution. Malpractice insurance is similar to errors and omissions policy, except this umbrella policy is designed for medical professionals.
Keep in mind what umbrella policies cover and what they don’t. For example, a personal umbrella policy won’t cover flood damage, certain kinds of property damage, or uninsured motorists. A professional umbrella policy won’t cover liabilities falling under civil law. For more details, contact your independent insurance agent for assistance in determining the proper amount of coverage and what coverage is available for umbrella policies that apply to your specific circumstances.