Financial calamity is not something you hope for, but it is something you plan for. One of the fastest ways to lose a lifetime of savings or future income is by facing a sudden lawsuit without enough liability insurance to cover the costs. At Frydach Insurance, we help customers learn how to manage the risks associated with litigation by providing supplemental liability protection that goes beyond the limits offered by most primary insurance policies. From car accident injuries to accusations of libel and slander, umbrella insurance can safeguard your income and assets against extreme liability.
What are Umbrella Policies?
Umbrella insurance takes up the cost of covered financial liabilities that exceed the limits of other liability insurance types, such as those found in auto, home, and renter insurance policies. It acts as a backup when your first-lines of coverage fall short of your coverage needs. It helps pay for excess legal defense costs when you are sued and for bodily injury, property damage, defamation, and other types of liability damages when you are found at fault. Without it, your personal income, savings, and assets could be at risk of garnishment, liquidation, and seizure to satisfy a judgment that exceeds your personal insurance coverage limits.
Imagine your teenage daughter invites her high school friends over for a pool party. During the gathering, your back deck collapses, severely injuring multiple guests. They all require hospitalization, and some require reconstructive surgery and rehabilitation. One loses his shot at a football scholarship due to an injury that will prevent him from playing. Each student’s parents sue your family for medical bills, pain, suffering, and compensation for other financial losses. Your homeowners liability insurance covers $500,000, but your legal fees and liability expenses add up to more than a million dollars. With an umbrella policy, the excess damages could be covered by insurance. Without it, you could be responsible for paying the remaining costs out of pocket, whether that means liquidating your savings, selling assets, or making payments from future wages.
Understanding Your Coverage
Most umbrella policies provide a minimum of $1 million in supplemental liability protection, although many policy-holders opt for much higher limits. Insurers may offer as much as $5 million or more in umbrella coverage, which could be used to help cover:
- Litigation expenses
- Accusations of libel, defamation, and slander
- Victim bodily injury, including medical and rehabilitative expenses
- Pain and suffering compensation
- Reimbursement of a victim’s lost wages
- Liabilities while traveling abroad
- Landlord/rental property liability
Wisconsin Umbrella Insurance is Affordable
Umbrella insurance is not just for the wealthy. At Frydach Insurance, we often recommend personal umbrella policies to our clients – including those with few assets. That is because having an umbrella in place not only helps protect the life you have already built, but it can also safeguard the future you are working to create. Fortunately, umbrella insurance may offer high limits, but the cost of coverage is comparatively low and affordable for most individuals. Furthermore, the cost of raising umbrella limits typically becomes more affordable with each additional million dollars in coverage added to the policy.