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Why is it Important to Have an Umbrella Policy?

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What is Umbrella Insurance?

It’s an important question, and one you’re not alone in asking: what is an umbrella policy, and why should you have one? Most simply, umbrella insurance (also called excess-liability insurance) is a policy you get in addition to your home, auto, and/or boat policy to help in the event of a major claim or lawsuit. It provides protection over and above your existing home, auto, and/or boat policy.

If, for example, a claim is made against you and costs exceed the coverage provided by your home, auto, or boat insurance, an umbrella policy, much like a physical umbrella, will help cover you for the rest. Umbrella insurance only pays out once your main policy has been paid out in full, and it will only pay out the remainder of your costs.

What Does Umbrella Insurance Cover?

As we mention on our website, “umbrella insurance is specifically about liability, which is the cost you might have to pay to somebody else for an unfortunate event where you are held responsible.” This means that umbrella insurance doesn’t typically cover losses you bear yourself, such as property damage or stolen belongings. Rather, it protects you from losing your assets in the event of a claim or lawsuit against you.

How Much Does an Umbrella Policy Cost?

An umbrella policy is probably cheaper than you think. While it does cover large potential payouts, the premium typically reflects the decreased likelihood the policy will need to pay out. The cost of an umbrella policy is low considering how much coverage it can provide.

Should I Get Umbrella Insurance?

An umbrella policy’s primary function is to protect your assets in the event of a mishap. Mishaps happen every single day because we are all human and we all make unfortunate mistakes from time to time. The truth is that anyone can be sued. It is for this reason that we recommend umbrella insurance for just about everyone.

The name of the game with insurance is preparedness, the idea that you can never be too equipped for the low moments in life, and umbrella insurance certainly helps to keep a low moment from becoming even worse.

Our team here at Lee Reed Insurance can help you find an umbrella policy that is right for you, as well as answer further questions you may have about umbrella insurance. Call (813) 782-5502 or email today.

The above information should serve as a general overview of umbrella policies. Specific policies should be discussed with an agent as coverage can vary between every individual policy.