Insurance is a multi-billion dollar a year industry in the United States. Millions of claims are made each year covering a wide range of issues and categories, and most are resolved without issue. As a car or homeowner, you already carry insurance. However, what happens if you become involved in a serious auto accident, or are found at fault when someone badly hurts himself on your property?
Lengthy and expensive civil suits can leave you penniless, and judgements against you can result in ongoing financial obligations that could have serious implications to your family’s well-being.
Given these possibilities, all homeowners should purchase an “Umbrella Policy” from their insurance carrier. An umbrella policy refers to a liability policy that protects the assets and future income of the policyholder above and beyond the standard limits on their primary home or auto insurance policies. Liability insurance is insurance specifically designed to protect you in case you are sued for claims that fall within the coverage of the policy.
An umbrella policy is sold in increments of one million dollars and is designed to “drop down” to fill any gaps in liability should the need arise. The policy acts in tandem with an existing homeowners or auto policy, and requires minimum amounts of these insurances to already be in place. For example, if you have an auto policy with $500,000 liability coverage, combined with a one million dollar umbrella, your effective coverage is $1,500,000 against a suit.
In addition to home and auto policy supplements, an umbrella policy also provides coverage for boat insurance, false arrest, liable, slander and invasion of privacy claims.
To assess how much umbrella policy insurance you should purchase, it’s important to total up the value of your assets including your home, cars, retirement accounts, saving and checking accounts , investments and so on. The umbrella policy you purchase should reasonably cover the value of these assets.
Generally umbrella policies run a few hundred dollars per million, and then adjust incrementally as each additional million is added. With all the insurances we already pay it may seem like an added burden, but if you are ever involved in a major accident or lawsuit, it’s worth the peace of mind.
Heather Coombs-Perez and Heart realtors are part of Culver City’s award-winning Cavanaugh Realtors team. Committed to Culver City schools and community through the Gifts From the Heart Program, you can reach Heather at 310-259-7419 or [email protected] You can also visit the website at www.heartrealtors.com for more information.
For insurance information, contact P. Garardo Jaramillo at Tower Insurance, 310-837-6101.