Know What an Umbrella Policy Is

A personal umbrella policy, also know as PUP, is a type of insurance that provides liability coverage over and above your automobiles or homeowner’s policy. So, if your liability coverage is not enough to cover the damages of an accident you cause or an incident on your property, a personal umbrella insurance policy kicks in right where your other liability underlying limits have been reached. An umbrella policy can protect you when your automobile or homeowners insurance isn’t enough.

How the Umbrella Policy Protects You

To better understand how a personal umbrella policy works, here is an example. If you are at fault in a car accident that injures another driver, your regular automobile insurance will cover the other driver up to the limit you selected, say $250,000. But what happens if that limit is not enough to cover the other driver’s needs? If the other driver’s injuries are severe, he may require benefits beyond the $250,000 your policy covers. In this case, he could sue you, which means your personal assets would be at stake. This could be a small amount, but imagine if that injured driver were a surgeon or another high paying professional. What if the accident you caused resulted in an injury that kept him from doing his job for six months? Suddenly, he is suing you for one million to cover the six months he is away from work. Your automobile policy covers the initial $250,000, but where would you come up with the remaining $750,000? A personal umbrella policy can cover the additional costs when your insurance is not enough. The personal umbrella policy could provide the additional coverage you need so that you do not get stuck trying to pay the remaining balance yourself. This extra policy could protect your bank account, home, and other personal property.

Contact us With Any Questions

If you ever have any questions about your insurance coverage or different plans that are out there, make sure to contact us. We can advise you on what the different insurance plans and policies are. We can also recommend what insurance you should invest in. This way you can be covered for any accident or natural disaster that might strike. You have several options to choose from for auto insurance, home owner’s insurance, and health insurance. By having the right coverage, you can plan for any situation.