Umbrella insurance is a policy which is also known as personal liability insurance. Umbrella insurance is often overlooked in the world of insurance policies. However, it can become a real lifesaver in certain situations. This type of insurance policy provides an extra layer of protection above your standard insurance policies. To properly understand the importance and benefits of umbrella insurance, InsureWise would like to share some potential real-life scenarios where umbrella insurance has stepped in and saved the day.
Unfortunate Accident
A successful business owner was hosting a pool party at their home. Unfortunately, one of their guests had a severe accident, resulting in an injury and medical expenses where a lawsuit was filed against the businessman for negligence. The claim was for $1.5 million, but the businessman’s homeowner’s insurance only covered up to $500,000 for personal liability. Thankfully, they had an umbrella policy that covered up to $2 million. Their umbrella insurance kicked in after their homeowner’s insurance was exhausted, saving them from a potential financial disaster.
Defamation Suit
A blogger wrote a post about a local restaurant’s hygiene practices based on their personal experience. The restaurant had poor hygiene practices and the blogger wanted them to be held to a higher standard. However, the restaurant owner sued them for defamation, seeking $750,000 in damages. But the blogger’s homeowner’s insurance didn’t cover defamation claims. However, their umbrella policy did. The umbrella insurance covered the legal fees and any potential settlement, protecting the blogger’s assets and future money.
Car Accident
A father of three, was involved in a car accident that was deemed his fault. The other driver suffered severe injuries and sued him for $1 million. The father’s auto insurance had a liability limit of $300,000. Without his umbrella policy, he would have been on the hook for the remaining $700,000. But his umbrella insurance covered the excess amount, saving him from major financial hit.
Landlord’s Liability
A landlord was sued by a tenant who fell down the stairs at one of his rental properties, resulting in permanent disability. The tenant sued for $2 million. The landlord’s insurance had a liability limit of $1 million. Luckily, their umbrella policy covered the remaining $1 million, protecting the landlord’s other assets, such as personal home and savings.
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These are some classic scenarios that highlight the importance of umbrella insurance. Umbrella insurance provides an extra layer of protection when your standard insurance policies reach their limits or does not provide coverage. Both homeowners and business owners would greatly benefit from having umbrella insurance. Umbrella insurance can save you from potential lawsuits and financial loss. Umbrella insurance is an investment in your financial security and gives you peace of mind. Umbrella insurance is unfortunately often never considered. Most people assume that they will never run into a situation where they need more coverage. However, life is very unpredictable and you never know when you will be on the other end of a lawsuit. To ensure you are protected you may want to consider getting umbrella insurance. If you need quality insurance coverage, contact InsureWise or click here to submit a quick and easy quote form.
