Personal Umbrella


What is the purpose of a personal umbrella?

A. It protects you from the rain
B. It provides you a higher level of liability protection through higher limits and broader coverage

Well, technically both answers are right, but for the purpose of this Blog article, we’re going to go with answer B!

A personal umbrella policy can be purchased in addition to your personal automobile and property insurance policies.  As mentioned above, the umbrella policy provides you with a higher level of liability limits as well as broader coverage.

There are many different features to a personal umbrella policy, and the coverage may vary slightly between Insurance Companies. For the purpose of this article, we will go over some of the most common ones:

  • Provides protection of up to $5,000,000 in excess of $1,000,000 primary coverage for damages which you are legally obligated to pay due to personal injury or property damage
  • Family Protection Coverage is included if the coverage is provided in the underlying automobile policy
  • Business pursuits are covered to the same extent as provided in the underlying policy
  • Coverage for recreational items, such as watercraft, motor homes and motorcycles, is provided where the risks are insured by the Insurance Company
  • Defense, settlement and supplementary payments are covered if not provided under the underlying policy
  • Provides a daily limit for expenses incurred in relation to the law suit, including loss of earnings
  • Drop-down feature gives extra protection against losses not covered under the liability portion of traditional property policies (i.e. libel, slander, etc.)
  • Covers acts or omissions as an officer or member of the Board of Directors of a non-profit organization or corporation
  • World-wide coverage

Most individuals that have personal automobile insurance and property insurance in place can qualify for a personal umbrella policy.  There are also commercial umbrella policies available.  As with most insurance products, there are certain risks that are not eligible for the coverage for specific reasons. Some of the most common ones are:

  • The underlying insurance policies carry less than $1,000,000 liability coverage
  • The person has previously been sued for libel or slander
  • Risks with accident or claim frequency, known financial, moral or criminal history
  • The underlying insurance policies are in a company or business name
  • Risks that do not satisfy other underwriting requirements
  • The person’s occupation/profession is considered high risk, including but not limited to:
    • Professional entertainers
    • Broadcasters and journalists
    • Professional athletes
    • Television personalities
    • Politicians

A personal umbrella policy can be set up by completing a simple application, and in some cases, it can be added directly to your existing property insurance policy.  For more information or to obtain a quote, please do not hesitate to contact our Office and we would be more than happy to assist you!

Thank you,

The Costen Insurance Team