Umbrella policy for personal liability.

[Pop_Rivit]

A few years ago we raised our umbrella policy from 1 million to 3 million at our CPA's suggestion. A rule of thumb suggested to us by our CPA was an umbrella policy equal to roughly our net worth, and after doing some research his advice makes sense.

Given the potential exposure to judgements and medical expenses of even a small accident or incident, and given our income and assets, and knowing that a judgement could be rendered against our current and future assets, it only makes sense to keep ourselves well covered.

Originally Posted By: bepperb
Originally Posted By: CivicFan
Even if you have no assets, the court may garnish your earnings.


Right, but what are your earnings? Don't tell me but understand that I don't know. This affects the likelyhood that someone would try to sue you for them. If you make 7 bucks an hour buying this policy is stupid. If you make six figures it's probably not a bad thing to consider. Insurance companies usually sue for the policy max because it's in the paying insurance companies best interests to settle. If they don't accept a settlement offer for less than your limit they are liable for what the court awards at and above that. The victims insurance company knows this, and they weigh this (easy money) against how difficult (very difficult) it will be to get your assets or to get a judge to garnish your wages.


Current earnings are only part of the equation. Future earnings can also be impacted, and it's extremely short sighted to suggest otherwise. Most people will make more in the future than they currently earn.

Originally Posted By: Rand
A salesman doing his job.


A poster who doesn't have a clue.

 

[morris]

like my dad says "its cheap ins" in this day any thing could happen.

 

[daves87rs]

With the sue happy crowd now, there is never such a thing as too much insurance.

A good, nasty lawyer will know how to take what you have.


Just ask my parents neighbor, they got him for everything, including some of his kids stuff....

 

[crinkles]

This is a strange concept. I can't find a similar thing in Australia. Good idea though

 

[Shannow]

Your green slip covers (I think) $20M personal.
Your comprehensive (and third party) covers $7M
Your home covers (I think) $7M on your property (not tradesmen, who you have to check their insurances).
Your $75 SSAA membership gives you $96 worth of magazines, a genuine reason, and $7M of liability cover when using your firearms.

One of the actual reasons for some of our stuff costing so much more than over there.

However, there was a case in town, where the local council, who legally own the footpath and nature strip, were sued by someone who stepped in a depression of the grass, and sued council. They argued that although they owned it, maintenance was "traditionally" by the person whose house fronted it...they won, he got sued, his insurance didn't cover past the front gate.

That was a seriously suss ruling...

Dad got Staph infection from Red Cross on a blood donation (he donated), and their attitude was "sue us, you'll go broke before we do".

I think we do pretty well at not sending people broke through happenstance.

However, my annual fire services levy to pay for the lady down the mountains who could have 1/2M property, tennis courts and horses, lost them in a fire, and couldn't afford the insurance counts as one of those "suss" areas that seem to exist around certain groups of people.

 

[Slick17601]

You may be able to raise the liability on your homeowners. I have min at 800K.

 

[DuckRyder]

A cross jurisdictional discussion of insurance is nearly useless, but a few points to consider.

PULPs generally cover things that would not be covered under a Homeowners, auto, boat or RV policy (in addition to being excess on those policies).

They are generally fairly inexpensive, the drawback being that they usually require higher liability limits on the underlying policies which raises the cost of those policies.

Your agent is probably best prepared to discuss your concerns/needs and if you don't trust him/her then you should probably consider finding someone you do trust.

 

[saberz]

Originally Posted By: CivicFan
I was talking to my insurance agent today and he suggested me to get an umbrella policy for personal liability. Right now my home insurance has $300k and the cars would get $250k per person/$500k per incident coverage per car.

The umbrella policy would add $1 million on top of that. The cost is $260 per year.

While $300k or $500k sounds enough, having worked in the health care industry has shown me that a serious incident can cost upwards of $1 million. If I am in a kind of an accident that seriously injures someone, it is probable to go bankrupt after the insurance coverage is exhausted.

What do you guys think?


Was this Geico? Everytime I called they tried to sell it to me and explained that people were sue happy blah blah. My quote was like $300 a year as well.

 

[CivicFan]

No, it's American Family. I refuse to do business with little lizards.

 

[CivicFan]

Thank you all for your advice and insight. I discussed it with my wife and we agreed that this is a good policy to have given the kind of risk we face (at least 2 hour long commutes every day, etc.).

 

[Al]

Originally Posted By: Pop_Rivit

Originally Posted By: Rand
A salesman doing his job.


A poster who doesn't have a clue.

lol..pretty much...

 

[bigmike]

This might be the first time I've heard of an umbrella policy. None of my insurance agents ever mentioned it.

 

[The Critic]

Originally Posted By: CivicFan
No, it's American Family. I refuse to do business with little lizards.


American Family. Ahh, that company's name has been mentioned a lot at work lately.

 

[Tdbo]

Never especially thought I would ever need one until my wife was plowed in the side of our van by a mail carrier (who by her own admission in court was not paying attention) delivering mail in her own personal vehicle. Even though the resulting lawsuit against us was scurrilous, something about sitting in a court room listing to an ambulance chasing dweeb (and this guy really was.) announcing that he is going after you for 218K is startling. Learned my lesson, got the Umbrella policy and have never looked back. A great deal of peace of mind can be purchased for $260/year.