Curious if many of you have this and especially anyone who's had to use the coverage. I've been paying for mine for several years 1 Million I believe. I'm probably not getting rid of it because of my landlord exposure but it just seems like another subscription fee I'm always paying for.
OT Umbrella Insurance
- Thread starter Vanhusker
- Start date
I hear you. What's your exposure? How much liability insurance do you have as a base? You're a landlord? A million dollar umbrella seems low. What's it costing you?
Umbrella insurance stacks on top of your auto liability and this is where a very high percentage of UB coverage claims arise from. As a rule of thumb, if your net assets are above 100K ( house, 401k, etc ) you need to have one of these. It is a good idea for EVERYBODY TO REVIEW THEIR AUTO LIABILITY LIMITS, YOUR UNDERINSURED AND UNINSURED MOTORIST COVERAGE. Nebraska allows drivers to purchase 25k auto limits, so if a driver with one of those policies hits you, you have the under insured, or uninsured if the guy is a total bum and has no insurance. If your laying in the hospital racking up huge med bills due to no fault of your own, you have those coverages to fall back on. Typically if you are at fault, and have high limits for liability ( 500K ) and an Umbrella, an attorney will work with you and not go after any of your assets if their total demand is in excess of your coverage. Also, Umbrella liability is broader coverage than standard home or auto liability so you also see times where a claim can or will be paid by a UB policy that would not have been paid by the more narrow liability coverage on home or auto.
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Little fish landlord. 4 single family homes. I pay just under $400/yr. I don't know offhand what my liability base is, but I use an insurance broker who seems to think I have the appropriate level of coverage.
You’re one serious at-fault auto accident away from understanding why you paid for that umbrella every year. It’s cheap insurance in the grand scheme of things.
We have $500k limits on auto and $1m umbrella. Never used it … fortunately.
An attorney friend told me 20 years ago that I should carry an umbrella that covers the amount recently or commonly awarded in my state for wrongful death. At that time I think it was 2 million. I carried 3 for over decade. I think we’re doing 5 now. Should probably be doing 10. All depends on what you have to lose.
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Cannot be had here, so windy that all insurers refuse coverage. Only umbrellas we see are from cruise ship folks, tourists 
Damn it, I had a similar joke lined up but you beat me to the punch.Cannot be had here, so windy that all insurers refuse coverage. Only umbrellas we see are from cruise ship folks, tourists
I carry 1MM personal for stuff on my property and such and 1MM for Peptide/HRT Business. Both cost around $300-$500/yr. Cheap enough that it's better to have and not need then need and not have. Don't believe I need the 2nd one but cheap enough to have.
Personal umbrella is my entire job and while I obviously have a vested interest, the easy answer is you should have as much as you can afford; it is always better to have it and not need it than the reverse. Umbrella coverage is about the cheapest insurance you can buy. The issue is you never know who you are going to have an accident with and what their injuries/expenses are going to be.
In my presentations, I use an everyday, real life, example from about 20 years ago. My client was running at the health club and clipped another runner's heel, what we called a "flat tire" when we were kids. The other individual fell and broke his wrist. On the surface not a big claim/lawsuit however the injured person was a pediatric heart surgeon making $750,000 a year. Due to the break he was no longer able to operate and had to take a teaching position at $250,000 a year. Given he was in his early 40's the lost wages alone were $10,000,000+ that our client was responsible for.
This was an accident that can happen to anyone and is just that, an accident, but the fact it was a surgeon, as opposed to a fast food worker, turned it from a nothing burger into a potential financially devastating event. The fortunate piece was our client carried a $10M umbrella and the injured party was willing to settle for the policy limit and not pursue a lawsuit.
In my presentations, I use an everyday, real life, example from about 20 years ago. My client was running at the health club and clipped another runner's heel, what we called a "flat tire" when we were kids. The other individual fell and broke his wrist. On the surface not a big claim/lawsuit however the injured person was a pediatric heart surgeon making $750,000 a year. Due to the break he was no longer able to operate and had to take a teaching position at $250,000 a year. Given he was in his early 40's the lost wages alone were $10,000,000+ that our client was responsible for.
This was an accident that can happen to anyone and is just that, an accident, but the fact it was a surgeon, as opposed to a fast food worker, turned it from a nothing burger into a potential financially devastating event. The fortunate piece was our client carried a $10M umbrella and the injured party was willing to settle for the policy limit and not pursue a lawsuit.
With 4 rentals I would definitely have an umbrella. If it were me I would have 1 million liability and 1 million umbrella. Just my opinion
I bought it after I bought a trampoline for the kids. It's relatively cheap coverage. Covers house, car liability (teen driver?). It also qualifies us for a multi-policy discount with my insurance company. I've heard that it's good if your net worth close to a million it is a no brainer. If you have 500k net worth, it's still good just for piece of mind in my opinion.
Yep you can never have enough coverage IMO especially if your net worth is up there. Hopefully you never get into a situation where it kicks in, but as you said it eases the mind just in case.
Is there any type of recommendation to the amount of coverage vs net worth a person has? Being in the profession what amount do you typically recommend?
Fortunately I live in a small town . I am 62 and I have had the same insurance company since driving at 16. Our first agent retired and the guy that took over is another hometown guy . He reviewed my policy and said I was good . Then my father passed and my situation changed and he called and said we need to increase it . I know nobody wants to pay more or thinks they need it .but f someone happens you will be thanking the lucky stars that you did have it .
An umbrella policy that's extending an additional $1M in liability coverage over your vehicles, primary home and 4 rental properties for only $400 per year. That's a good deal.
Honestly, with that many rentals, I'd bump up to at least a $2M policy. Your agent can thank me later.
The common advice is protect the net worth but that only tells half the story. Where you are in your life cycle has more to do with it and it is a bit counter intuitive. A retired widow that has a net worth of $10M, that only drives to the store and church probably doesn't need to protect the entire net worth as she has very little liability exposure. On the other side a 40 year old with a $2M net worth probably needs much more as they stand to have future wages garnished and are involved in more liability exposing activities.
As someone said earlier, the best bet is based off of the largest personal injury lawsuit/settlement in your given jurisdiction. That said, the most you can afford is also a good rule of thumb. Most carriers load the bulk of their expenses into the first million so the difference between $2M and $5M may only be a couple hundred bucks a year and well worth it. That said, your "main street USA" carriers get nervous over about $3M so rates may accelerate drastically (if even available). My rule of thumb is most everyone in a professional career should have at least $5M which admittedly pushes them to your top end carriers such as Chubb, AIG, PURE, etc. that have a bigger appetite and more experience with bigger limits.
As someone said earlier, the best bet is based off of the largest personal injury lawsuit/settlement in your given jurisdiction. That said, the most you can afford is also a good rule of thumb. Most carriers load the bulk of their expenses into the first million so the difference between $2M and $5M may only be a couple hundred bucks a year and well worth it. That said, your "main street USA" carriers get nervous over about $3M so rates may accelerate drastically (if even available). My rule of thumb is most everyone in a professional career should have at least $5M which admittedly pushes them to your top end carriers such as Chubb, AIG, PURE, etc. that have a bigger appetite and more experience with bigger limits.