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What fall outside of umbrella insurance policy?

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  • What fall outside of umbrella insurance policy?

    So people here always say get good umbrella policy. I did ... got a 3 million policy. From my understanding it covers above, auto, home, renter insurance. Also libel, slander, false arrest. What else does it cover? and more importantly what does it not cover? I would hate to come to a situation and get sued just to realize my umbrella does not cover a particular situation. Does the policy depend on individual company? I have all state by the way.....

  • #2
    My understanding of umbrella insurances is that they are just an extension of your regular insurance.   If your car insurance covers up to 500 K in damages, the umbrella kicks in after the 500K is met and covers the remainder 500-1Million, etc.   Same goes for home owners insurance.  Thats why they are cheap, they don't pay anything unless you go over the limit of your standard policy.  As to what they cover, I think that they just cover the same thing your regular insurance covers (ie umbrella over car covers everything your regular car insurance covers, just at the higher dollar amount).   When I was getting my umbrella insurance, they had to make certain that my regular car/home owners insurance limits were up to certain numbers so the umbrella would kick in after the fact.   Very worthwhile, its probably rare to be involved in a car accident that costs more then ~100K, but if there are serious injuries, the numbers can add up fast.  I think that most people can get away with still just keeping the minimum because they have no assets, if the average person is involved in a multi-fatality crash and has 5 million dollar judgement against them, the people suing are never going to see that 5 million dollars so it's not even pursued by lawyers sometimes.   With physicians and your income, you could be pursued for that 5 million judgement and actually be expected to pay most/all of it.  Rare, but can happen.

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    • #3
      Reminds me of some 10-20 years ago when I was a med student wearing my white coat in my car driving to a rotation when I was stopped at a stop sign, pulled out 2 feet, bumped a pedestrian in front of me who saw that I was wearing a white coat.    She went down to her knees, didn't fall, still called EMS, heard from her lawyer, insurance settled for 5K for "soft tissue injury".  Made sure I had umbrella insurance after that.

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      • #4




        Reminds me of some 10-20 years ago when I was a med student wearing my white coat in my car driving to a rotation when I was stopped at a stop sign, pulled out 2 feet, bumped a pedestrian in front of me who saw that I was wearing a white coat.    She went down to her knees, didn’t fall, still called EMS, heard from her lawyer, insurance settled for 5K for “soft tissue injury”.  Made sure I had umbrella insurance after that.
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        A fair reason to drive a non-luxury car. People see fancy car and think rich. Practice stealth wealth. Think of Vagabond driving his leaf or prius--the average plaintiff thinks he has no assets, perfect!

        Maybe drive a beater? In some towns a beater give you "right of way" versus fancy cars...

        Stash your white coat in the office/hospital or ditch it altogether.

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        • #5




          So people here always say get good umbrella policy. I did … got a 3 million policy. From my understanding it covers above, auto, home, renter insurance. Also libel, slander, false arrest. What else does it cover? and more importantly what does it not cover? I would hate to come to a situation and get sued just to realize my umbrella does not cover a particular situation. Does the policy depend on individual company? I have all state by the way…..
          Click to expand...


          It depends on your policy. Typically it will cover you if your dog bites your neighbor or someone slips on your porch and claims injury, etc.

          It typically does not cover a contractor you hire to work on your property. You need to make sure they have their own workman's compensation and liability insurance.

           
          Erstwhile Dance Theatre of Dayton performer cum bellhop. Carried (many) bags for a lovely and gracious 59 yo Cyd Charisse. (RIP) Hosted epic company parties after Friday night rehearsals.

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          • #6




            So people here always say get good umbrella policy. I did … got a 3 million policy. From my understanding it covers above, auto, home, renter insurance. Also libel, slander, false arrest. What else does it cover? and more importantly what does it not cover? I would hate to come to a situation and get sued just to realize my umbrella does not cover a particular situation. Does the policy depend on individual company? I have all state by the way…..
            Click to expand...


            This is a very good conversation to have with your carrier. You can read the policy line by line (yawn) or you can request a meeting, ask questions, and take notes. I can’t think of a reason the agent you bought the policy from would mislead you and nobody is better qualified (or should be, anyway) to explain the nuances of the policy you just bought than the person who sold it to you. If they aren’t, you may need to shop around based on a parameter beyond premium $$ (not saying you did that, but that it is the typical benchmark).
            Our passion is protecting clients and others from predatory advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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