Most of us know that umbrella policies cover us in the case of exceeding the liability limits in our auto or home insurance policies. While this is true, there are other reasons to hold umbrella insurance. Umbrella insurance provides excess liability above and beyond the coverage amounts on underlying policies. That is, if we are liable for damages in excess of what our policies provide, the umbrella provides the excess. In addition to auto and home policies, umbrella insurance also provides coverage on motorcycles, boats, ATVs, as well as a second home, land, etc. Naturally the more items that are insured under the umbrella, the more the premium increases. What about coverage for things not covered by an underlying policy? Less thought about but still covered under umbrella policies are occurrences such as libel, slander, certain lawsuits, and personal liability. This could include dog bites or defending yourself from personal […]
umbrella insurance
A Risk Management Checklist
Although many individuals have various risk management policies in place, sometimes those policies get brushed aside and every once in a while the dust needs to be wiped off of them and perhaps some updating needed. Here’s a checklist to consider the next time you review your risk management strategies. Auto Insurance – Review your coverage to make sure it’s still adequate. Liability limits of at least $250,000 should be the norm. Limits of $500,000 up to $1 million are better. If you drive an older car, consider raising your comp and collision deductibles or eliminating them altogether to save on premiums. Upside down on your car loan? Consider gap insurance. Better yet, don’t have a car loan. Home Insurance – Make sure your home is insured to its reconstruction cost. This is the cost to rebuild your home using today’s prices for materials, labor, etc. It is NOT the […]
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A Bad Day or a Bad Life?
As a financial planner I am often asked whether or not a personal liability umbrella policy is worth the price. Generally, my answer is a resounding “Yes!” Personal liability umbrella policies or PLUPs (for the remainder of this article) are insurance policies that provide coverage above and beyond the underlying liability limits on an individual’s or family’s auto insurance or home owners insurance. PLUPs can also be purchased by folks that have renters insurance or condo insurance policies. PLUPs are usually purchased in $1 million limits starting at $1 million. Umbrella policies work like this: Generally the person applying for the PLUP has their auto and or home insurance with the insurance company they are considering purchasing the PLUP through. What the insurance company will do is require that in the underlying auto policy that the personal liability (if a member of the insured household is liable for damages in […]
Sterling Raskie, MSFS, CFP®, ChFC®
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