Many people understand the need for car insurance or a homeowners policy – the protection these policies offer is relatively obvious, and commonly used. While these policies do an excellent job of protecting you against many costs of an accident or loss, they are often limited in the amount of coverage they provide. If you suffer a loss or are liable for financial damages that exceed the coverage of your home or auto policy, you may be left paying the overages out of your pocket.
If your assets or earning power exceed your policy liability limits, you should consider an umbrella policy. This coverage supplements your home and auto policies. Should you consider an umbrella? Does one of the following describe your role?
• Parent: As a parent, you are not only responsible for your own actions, you are also responsible for the actions of your children. Whether you have young children or teenagers, an umbrella policy benefits you in many ways, including adding extra coverage for medical bills resulting from a car accident and providing liability protection for childish decisions that result in losses to another party.
• Homeowner: Standard homeowners policies cover the physical structure of your home and outlying buildings. Unfortunately, few standard home policies offer protection against liability if a visitor is injured on your property. Umbrella insurance provides compensation for legal bills, judgments and medical bills relating to an injury accident that occurs in your home or property.
• Business owner: Owning a business opens you to a great deal of potential liability. If a business vehicle is involved in an accident, an employee damages another party’s property or a service or product you sold injures a client, you can be sued for damages. If your business coverage is not up to the task of covering the losses resulting from the incident, you may be left paying for the overage out of pocket. A personal or commercial umbrella policy could mean the difference between a covered loss and serious financial hardship.
In many situations, umbrella coverage is an affordable addition to your insurance package, and may prove to be invaluable in the event of a serious loss.
Have you ever suffered damages that have exceeded your home or auto coverage? Share your experience with other Killeen area residents in the comments section below.