Protect your assets with personal umbrella liability insurance

Why personal umbrella liability insurance?

Oh, no, not another insurance policy. In these challenging economic times, who wants to pay for another insurance product? We purchase auto insurance for our vehicles because the law requires it and homeowner's insurance on our homes because the lenders require it, and our home is likely one of our most significant assets. But, the insurance that helps you sleep at night knowing that the aforementioned assets are properly protected is a personal umbrella insurance policy. The reason is because it provides additional limits above and beyond the limits afforded by your auto or homeowners policy.

Why is this insurance policy important?

The "why" is simple. In today's litigious society, people are at risk of getting sued over just about anything. The expenses associated with such suits can be extensive and would likely include any financial awards to the plaintiff by the court system. In fact, the expenses can be so high that the funds awarded in a lawsuit often exceed the limits afforded by your auto or homeowners policy. Just because the limits of those policies run out, it doesn't mean that you, as the defendant, are absolved of any remaining balance. Unfortunately, the defendant's personal assets can be liquidated or assessed in order to pay for any outstanding legal obligation. This means that your home, vehicles and retirement savings can all be accessed in order to pay any outstanding legal balance you owe a third party.

A personal umbrella policy can provide additional insurance limits to meet these unforeseen obligations and provide you with additional financial protection before any of your personal assets may need to be liquidated to pay for any damages for which you may be held legally liable.

How much coverage is needed?

The "how" is equally simple. Personal auto and homeowners policy limits can be purchased up to $300,000. Once secured, a personal umbrella insurance policy can be purchased to provide additional limits above that "connection point" of $300,000 on the underlying auto and homeowners policy. Personal umbrella limits can be $1,000,000 and higher, with some insurance carriers offering umbrella limits up to $10,000,000.

Umbrella insurance is not meant to cover typical claims that you might see on any given day. It's meant to cover the catastrophic loss situations that we could face at any time. Think about a car wreck that results in significant injury to the other driver. Plus, it's not just wrecks you need to worry about. Imagine this: you're hosting a party at your home and someone slips, falls and is injured. Think you won't be sued? Think again. Umbrella policies provide the additional insurance limits needed to cover a catastrophic loss, yet keep your personal assets intact.

What is the cost?

The answer is, it's cheaper than you might think. Most insureds can secure $1,000,000 or $2,000,000 in limits for just a few hundred dollars a year in premium. The expense is nominal in exchange for the peace of mind you gain from knowing that your assets are protected properly. Once you have a grasp of why this is critical, the question of buying a personal umbrella insurance policy shifts from "why should I buy it?" to "why haven't I bought it yet?"

Where to begin?

So, how can you protect yourself from this significant risk of a catastrophic loss? The best course of action is to speak with a professional.

For personal risks, a personal lines insurance agent is a great place to start. A personal agent can guide you through the process and help secure the best coverage terms at the best price for your particular risk.

Keeping up with insurance matters can be an overwhelming process, especially given the many facets of your particular situation. We, at ACNB Insurance Services, Inc., like other full-service insurance agencies, often serve individuals and businesses in our community and maintain the specialized skills necessary to assist you in protecting what matters most to you.