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Personal and Commercial Umbrella Insurance: Understanding the Basics

Have you seen or heard about “umbrella insurance” but not been sure if it’s coverage you need for your home or business? Let’s take a look at what umbrella insurance does, so you can decide if this additional protection is right for you.

Personal Umbrella Insurance: More Coverage Where Your Auto Insurance Is Capped

Your auto and home insurance policies help protect you in the event someone is hurt in an accident on the road or at home. Legally, you could be found liable (responsible) for medical care after an injury or damage someone else’s personal property.

Many people don’t think about liability beyond their auto or home insurance policies. However, lawsuits happen every day in California when a driver is alleged to be at fault after an injury or when a sprinkler is damaged and causes water damage to your neighbor’s house.  It’s easier than you might think for an accident to happen.

Unfortunately, people have become more litigious lately — even lawsuits between friends and family members can occur. This is partly driven by a greater awareness of personal injury law, the skyrocketing costs of medical care,  and an increasing number of people without health insurance.

Your auto policy covers you in these circumstances, so you don’t have to pay out of pocket, which could decimate your retirement accounts or even cause you to lose your home. However, a standard auto policy only goes so far to protect your net worth. That’s where umbrella insurance comes in.

An umbrella policy can be activated once reimbursement with your regular auto insurance reaches its cap.  Depending on your insurance carrier you can purchase an umbrella policy with coverage up to one million dollars or more starting at $130 per year.  We highly recommend this extra protection for dog owners or high-net-worth individuals who could become a target for exorbitant legal damages.

Commercial Umbrella Insurance: Protection Every Business Should Have

Just as your home and financial assets may be vulnerable to liability lawsuits, so is any business you own. In fact, businesses are even more susceptible to liability issues by their very nature.

They see more visitors in and out in the course of a day, from clients to delivery people. And there can be more opportunities for hazards, too, with parking lots, automatic doors, industrial wiring, public restrooms, food poisoning at restaurants, and other places where people can get hurt. Furthermore, businesses typically have deeper pockets and seem more impersonal than individuals, making people less hesitant to take them to court for damages.

You may have general liability insurance for your business. However, it’s similar to homeowners liability coverage in that it has a limit on how much it will reimburse. Luckily, you can purchase commercial umbrella insurance for your enterprise to protect you in case someone sues.

Without this coverage, you could lose your business’s profits, your savings, or even the business itself if you have to close your doors due to extreme financial losses. With your own livelihood, as well as your employees’ incomes, riding on your success, you don’t want to risk losing everything you’ve worked so hard for by not having adequate liability coverage.

You can easily add an umbrella insurance policy to your homeowners or business coverage. It gives property owners greater peace of mind. If the worst happens, you’re prepared financially and can protect your assets.

Think an umbrella policy might be what you need to supplement your existing coverage? Reach out to Onstad's Insurance Agency by calling us at 925-866-1444 or by messaging our independent agents online for a quote.