If you end up being sued after a car accident, your insurance policy might not cover all of the expenses associated with the event. This is where an umbrella policy can help. Buying an umbrella policy can protect you beyond your auto insurance and homeowners insurance coverage limitations, and can offset many of the high costs associated with an accident. Umbrella policies work as an extension of existing insurance policies and serve as a cushion in the event of a serious accident. They’re a relatively affordable type of optional insurance coverage and available through several major insurance providers.
Here are some key reasons to purchase an umbrella car insurance policy:
1. Coverage beyond auto and homeowners insurance policies. Most companies that offer umbrella insurance provide extensive coverage beyond what your basic auto insurance and homeowners insurance provide. This gives you an extra cushion of liability protection and can give you some peace of mind when dealing with a serious accident or emergency situation.
2. Extra protection when traveling. Most umbrella policies will cover you for any accidents that happen while you are overseas or when traveling out of state. This goes beyond your regular car insurance policy and can help to offset many of the costs associated with an accident.
3. Coverage for legal costs. If you end up getting sued by someone after a car accident and your auto insurance doesn’t cover legal fees or other court-related costs, your umbrella policy will take care of it. This is actually one of the most common reasons why people purchase an umbrella policy.
4. Coverage for your family. Most umbrella policies provide coverage for you and your family. These policies will pay for claims that exceed the limits of your auto insurance and homeowners insurance policies. You can be confident that your entire family is covered in the event of a serious accident.
5. Affordable add-on. Some people mistakenly believe that an umbrella policy will be too costly and is out of their budget. Most companies that offer an umbrella policy do make it relatively affordable, and may be able offer you a very competitive rate if you are a longstanding customer and have purchased auto and homeowners insurance through them. Umbrella coverage is fairly comprehensive in scope and can be one of the most affordable types of add-on insurance policies available.
6. Personal injury coverage. Many umbrella policies will protect you in the event of defamation of character, slander and libel. If you need to hire a personal injury attorney and file a claim, your umbrella policy can cover some or all of the costs associated with the process.
Sources:
Insure.com – Umbrella insurance extends your coverage
Newbuyer.com What is an Umbrella Insurance Policy and Why Do I Need It?
Progressive.com – Personal Umbrella Insurance