Although the likelihood that you will lose a case for a sum greater than what your current insurance will cover is remote, you run the risk of losing all of your money if it ever happens. The goal of umbrella insurance is to prevent you from ever experiencing that nightmare. We'll examine this additional liability coverage in more detail below, including how an umbrella policy functions, who needs one, how much it costs, and what it won't cover.
Undoubtedly, fear plays a role in the choice to purchase umbrella insurance. Because of the lawsuit-happy society we live in, where anyone can sue you for anything and financially ruin you, many insurance companies claim that you need it. Numerous personal liability horror stories, where juries granted multimillion-dollar judgements to the victims that individuals had to pay, may be found in the news. But how probable is it that you'll be in this circumstance? Are umbrella policies really necessary? Umbrella insurance is typically recommended if the sum of your assets, including regular checking and savings accounts, retirement and college savings and investment accounts, and home equity, exceeds the limits of your auto insurance.
