What is "umbrella insurance"?

What is "umbrella insurance"?

Sam Friedman (Editor-in-Chief, National Underwriter, Property & Casualty Edition) gives expert video advice on: Do I need umbrella insurance? and more...

Umbrella insurance is coverage over and above the liability coverage in your standard homeowners policy. If someone is injured in your home, slipping on an icy sidewalk, tripping on your stairway, and they sue you, your homeowner's policy should have a limited amount of coverage.If however, the cost of the coverage, either in legal bills, or in the amount of damages that's claimed by the injured party, exceeds what's in the homeowner's insurance policy, your umbrella liability will kick in and provide an additional layer of coverage. It can run anywhere from a million to five million additional dollars of coverage and can be very important. In addition, the umbrella liability coverage could cover you if there's liability losses on your auto policy, or if you own a boat for example, on your watercraft policy. Again if you injure anybody in the course of driving or using your boat you should have auto and watercraft insurance that has a section that deals with liability issues. But your umbrella insurance policy is over and above that, it will give you an additional layer of protection in case the damages, the costs involved, go beyond your standard coverages.