Personal Umbrella Insurance

A personal umbrella insurance policy is a secondary form of insurance that supplements the protections afforded by primary, underlying policies.

Homeowners, auto, and other primary insurance policies may provide robust protections, but there’s almost always a limit to how much coverage they afford. For individuals who want additional protection beyond what their underlying policies will provide, it may be appropriate to purchase a personal umbrella policy. Personal umbrella insurance is a secondary form of insurance that supplements the protections afforded by primary, underlying policies. In many cases, personal umbrella policies offer levels of protection that simply are unavailable through only primary insurance policies.

Personal umbrella policies may supplement the protections provided by primary insurance policies in two ways. First, an umbrella policy will sometimes fill in coverage gaps left by primary policies, thus providing coverage where there otherwise would be none. Second, an umbrella policy may build on the limits of underlying policies, frequently providing more protection than is offered by underlying policies’ highest available limits.

Anyone who wants more protection than the limits of their underlying insurance policies allow for may be interested in personal umbrella insurance. This may include (but isn’t limited to): People who participate in high-risk activities (e.g. boating or riding motorcycles) and want additional protection in case they’re liable for an accident; Dog owners who want extra liability protection in case their dog bites another person; Landlords who need additional coverage from potential lawsuits filed by tenants; Wealthy individuals who fear they might be targeted by an opportunistic lawsuit; and Volunteers who take on additional responsibilities and may be held responsible for accidents.

Both personal umbrella and excess liability policies are supplemental insurance policies that offer protection beyond what primary policies provide. There is an important distinction between them, though. Personal umbrella policies typically come with their own terms, conditions, definitions, and exclusions. Since they have their own language, personal umbrella policies are often able to supplement multiple underlying policies at the same time, and they can sometimes fill in coverage gaps.

Most personal umbrella policies are strictly liability policies and don’t offer additional protection for property. People who need more coverage for specific property may need to increase the property limits of their current property insurance policy (e.g. homeowners policy), purchase a rider for their current policy, or get a different property insurance policy.