Umbrella insurance

When you hear the term “umbrella insurance,” your first thought might be, “What do umbrellas have to do with insurance? Is this just another product the insurance industry is trying to sell me?” Actually, umbrella insurance has nothing to do with conventional umbrellas.

Umbrella insurance is “extra insurance,” like an umbrella is extra protection against the rain, even though you have a raincoat on. Think of your regular car and homeowners insurance as the raincoat, and the umbrella insurance as the “umbrella” you carry for torrential downpours. (more…)

For inquiring minds: A white paper about umbrella insurance

We’ve written two posts on our blog in the last year about the importance of having umbrella insurance for those who have wealth:

Why lose what you’ve worked hard for?

Umbrella insurance – why it might be a good idea for you

If you want to understand this type of insurance and the risks it covers in much greater detail, please click here to read an excellent white paper on this subject, published by ACE Private Risk Services.

Why lose what you’ve worked hard for?

Recently there was a nine car and truck pile-up in Florida caused by fog and smoke that suddenly came across the highway in the middle of a dark night. Unaware of the danger ahead, drivers blindly slammed into each other at high speeds. The light of day revealed a gruesome scene of twisted metal strewn for over a mile. Ten lives were lost.

About six months ago, someone I know was standing on a wooden deck at a friend’s home when suddenly the deck gave way and crashed to the ground. He fell from a height of around seven feet, leaving him with bruised ribs, cuts, and a very sore knee. Fortunately for the homeowner, no one was killed or seriously injured and no lawsuit ensued.

For those who have worked hard and saved a sizeable amount of wealth, these stories highlight that, without the right kind and amount of liability insurance, the risk is very real that you could lose all or part of your nest egg to some sudden and unpreventable event. Many people correctly buy an umbrella policy to cover these kinds of risk, but they fail to increase the amount as their net worth increases over time.

If I haven’t scared you enough already, the median award nationwide as a result of a wrongful death due to an auto accident is $1.5 million, not including loss of service, grief, sorrow, or punitive damages or payments to additional injured passengers riding in a car owned by you.

Another scary thought….the next time you’re driving along the interstate, look around at the drivers surrounding you. One out of six has no auto insurance whatsoever. And that number is rising. This does not even include the people who are underinsured.

With the cost of umbrella insurance averaging only $100 to $200 per $1 million in coverage per year, why keep this on your worry list any longer? Although this is beyond the scope of the advice provided by Merriman to our clients, your property and casualty insurance agent stands ready to do a personal insurance review for you.

So if you want to sleep better tonight, pick up the phone and make that call today!