What are Umbrella Policies: The Benefits to You & How They Can Protect You
Umbrella policies, if you have no idea what these are then it can sound like rules for storing your umbrella. But this is not quite what umbrella policies are, and you should know what they are as they can indeed protect you. This is why today I’ll tell you everything you need to know about umbrella policies and how they can be useful to you.
What are umbrella policies?
Before we can start talking about the benefit of umbrella policies you need to understand what umbrella policies are. Umbrella policies are a form of insurance, which is why it makes sense that they can protect you.
Umbrella insurance is not a separate kind of insurance, and it is definitely not an insurance that will ensure your umbrella. No, it’s none of that, umbrella policies are a kind of policy that is added on top of an already-existing insurance, which can be any kind of insurance.
What umbrella policies do is that they add coverage for liability on top of an insurance for your car or your home for example. Such an insurance policy will protect you from major claims or lawsuits. When the liability from one of the policies for any kind of insurance has been exhausted then the umbrella policies can help cover for this. So let’s get into the details of what umbrella policies cover exactly.
Umbrella insurance has insurance for injuries, damage to your property, certain lawsuits, and other personal liability situations. Now you might think that you already have insurance for these things, but umbrella policies work differently. Umbrella policies cover for things that your regular insurance doesn’t cover. Think about an injury to someone else that you caused by being at fault during a car accident. No regular insurance would cover for that, but umbrella policies can pay for this so that you’re not left with huge bills.
Some other examples of what umbrella policies will cover for you are damage claims that are made against you when your pet damages someone’s property. Any form of landlord liability will also be covered by umbrella policies for example.
All of this might sound like umbrella policies will cover for anything that your regular insurance doesn’t cover, but unfortunately, this is not the case. Umbrella policies won’t cover for everything. To give you a clearer picture I’ve got also some examples of things that aren’t covered by an umbrella insurance. An example is personal belongings, which are almost never covered by umbrella policies. Another example is that although umbrella policies generally cover damage you do to other people’s property it doesn’t cover for this when this damage is caused by intentional criminal activities. Damage to your business or any other business-related losses is not covered by umbrella policies as well, which is something that you need to keep in mind. Umbrella policies cover a lot of things and can have a lot of meaning but you do have to remember that there is no insurance that covers for absolutely everything. It’s important that you realize this.
The benefits of umbrella policies
Now you’ve got an idea of what umbrella policies are you should know the benefits that umbrella policies bring with them, and I’m sure that you can already think of some benefits to umbrella policies, yet I am going to clarify them for you. That way you’ll know that getting umbrella policies for yourself is a choice that you’re probably not going to regret making.
When the expenses go well above your regular insurance
Let’s say that someone’s injured on your property or during a car crash in which you play a role. Your liability insurance will probably cover for some part of the expenses, but if the injury is severe then the expenses of this may rise well above what this insurance covers and you’re left with a lot of costs to pay. This can be especially problematic when you’re already on a tight budget. In such a case umbrella policies can be your saviour as they will cover for the money that your regular insurance does not.
For your peace of mind
Let’s say you have a pool in your backyard, and more often than not the friends of your children are playing out here. An accident is always right around the corner, even if you try so hard to prevent it. It could give you peace of mind to know that in the case of an accident your umbrella policies will be able to pay for all the costs involved. This may sound like a strange reason to get an insurance, but your peace of mind is one of the most valuable things you have so you want to protect this. What do you have left when you lost your peace of mind? Exactly, a life full of stress. That’s something that isn’t going to make anybody happy. This is why getting umbrella policies is so important, you won’t need to worry about your assets or your savings anymore, they are safe.
It doesn’t have to be expensive
You may think that an insurance which covers this much costs a lot of money, but this is not really the case. As a matter of fact, you can get umbrella policies that cover up to $1 million dollars for no more than $200 per year. If you consider how low the cost is for so much extra coverage that it is almost impossible not to take it on. If you consider how much money you could end up saving with this on top of the extra protection and peace of mind that it offers, umbrella policies are practically free.
How it will protect you and your assets
Possibly the biggest reason for getting umbrella policies is all the extra protection it offers you. First of all, we have your assets. If you had to pay a big sum of money because you lost a lawsuit, and your insurance didn’t cover all of it, then your assets might come into danger. You could lose your car for example. Umbrella policies will pay the difference and will thus always protect your assets so you can’t lose them. But not just your assets will be protected, what about all the savings you have for your children going to college, you don’t want to lose that money to a lawsuit. This is why you should have umbrella policies, they will ensure that all your assets and the money you have are safe from all risk.
Especially when you consider how low the costs are for all this extra protection, you would almost be crazy not to get extra umbrella policies. This is why I would advise you to assess all the risks that exist in your life and find which umbrella policies fit your needs the best. There are many different umbrella policies out there, and they all have minor differences even though the main concept remains the same. This is why you should do thorough research before you settle for an umbrella insurance. You do want to have the umbrella insurance that fits you and your needs the best. In that way, you’re sure that you’ll be fully covered in case of any issues that might cost you money.
To sum it all up you should know that umbrella policies offer liability coverage on top of your regular insurance. The reasons for getting these umbrella policies on top of your regular insurance are that they will cover any expenses that you might need to make in case of a lawsuit for example, they will protect your assets, they will give you peace of mind and it doesn’t even have to cost you a lot of money. I don’t see any reason why you shouldn’t get umbrella policies.
Guest post by Nielsem.