Personal Umbrella Insurance and When You Will Need it in Wilbraham

Aug 19, 2016 11:05:52 AM

Undoubtedly, many homeowners make protecting loved ones and assets their main priority. Accordingly, most people in Wilbraham opt to pay for homeowners insurance as a precaution. However, some people find themselves in a situation where a basic homeowners (or auto) insurance policy is insufficient for their needs. If you happen to be in this situation, you may want to consider personal umbrella insurance. Here is some information that will help you determine whether you could benefit from umbrella insurance.

Personal Umbrella Insurance Wilbraham

What is Wilbraham Personal Umbrella Insurance?

A personal umbrella policy (PUP) refers to insurance that provides policyholders with liability coverage that surpasses that of an automobile or homeowners policy. Therefore, if the liability coverage of an automobile or homeowners policy proves to be insufficient in the event of a covered loss, the umbrella policy will kick in to help cover the rest. An umbrella policy gives individuals peace of mind, as they don't have to worry as much about financial ruin.

If you're still unsure how personal umbrella insurance policies work, pay close attention to this example: If you happen to get into a car accident and the other party is injured, your automobile insurance may cover the cost of the losses up to $250,000, which is the limit you hypothetically chose. If the losses are severe and $250,000 simply doesn't cut it, a PUP can help cover the additional costs. For example, if the other party is a high-earning professional and he or she sues, you may face a lawsuit of $500,000 to help cover the costs of both the injury and time spent away from work. A PUP may be able to help you cough up the $250,000 not covered by your auto insurance policy.

Without a PUP in the scenario described above, you would be stuck trying to pay the $250,000 on your own. You would likely need to dip into your bank account and sell your home and other personal property. Even then, you still may find yourself in serious debt.

When Do Wilbraham Residents Need Personal Umbrella Insurance?

Any Wilbraham resident who has assets to protect could benefit from umbrella insurance. This is especially true for residents who have assets valued at more than $1 million. Usually, umbrella insurance policies come in million dollar increments. These increments range from $1 to $5 million. If you have $2 million in assets and end up being sued, you want an umbrella insurance policy that will help protect your assets. For your assets to be sufficiently protected, you would want a policy for $2 to $3 million. Keep in mind that future personal assets, such as wages, are also covered by umbrella insurance policies. Therefore, you should consider your future assets when selecting an increment for your PUP.

Are PUPs Only for Wealthy People?

Speaking of future assets, even your wages are at risk when you face a lawsuit. If you happen to lose a case, it is possible that your future wages will be garnished. Therefore, the perception that PUPs are only for wealthy people is completely false. Wage should only come into play when determining the appropriate increment for your umbrella insurance policy. Wealthier people would probably benefit from higher increments.

Just about every homeowner in Wilbraham could benefit from buying a personal umbrella insurance. Most people have assets to protect, whether these assets come in the form of savings and property or future earnings. For more information about umbrella insurance policies, don't hesitate to contact a friendly local insurance agent!
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This material is for informational purposes only. All statements herein are subject to the provision, exclusions, and conditions of the applicable policy. For an actual description of all coverages, terms, and conditions, refer to the insurance policy.  

Edward J. Adamczyk

Written by Edward J. Adamczyk

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