Understanding umbrella insurance

by Ann Hayward 10/14/2024

Umbrella insurance is a policy that can cover the gaps in many other types of insurance policies by answering some of life’s major “what if” questions. While it’s common to have many types of insurance policies, umbrella coverage can provide financial assistance for a variety of outlying situations.

Here is a basic guide to umbrella insurance to help you learn more:

What does umbrella insurance cover?

Umbrella insurance provides additional personal liability coverage for situations not included in other policies. The major liability issues umbrella coverage includes are bodily injury, property damage and legal coverage in certain lawsuits.

Umbrella insurance can help you in a variety of situations where another person is injured due to an accident. These might be events your auto insurance or homeowners insurance cannot pay for. Some examples include:

  • A guest falls while visiting your home
  • You’re at fault in a major traffic accident
  • A neighbor is bitten by your dog

It can also cover you if you’re sued for certain things, including but not limited to libel, slander or false imprisonment.

What is not covered by umbrella insurance?

There are several key differences between umbrella insurance and other types of policies. For example, here are some things similar to those listed above are not covered:

  • Damage to your personal property.
  • Medical bills from a personal injury, typically your own.
  • Any liability assumed under a contract.

Do I need umbrella insurance?

Hopefully, you will never have to worry about these or any other types of insurance claims, but umbrella insurance can mitigate your losses if something should go wrong.

Ultimately, the decision is personal and might depend on numerous factors including your property type and location, how many vehicles you own and what your existing home and auto insurance limits are.

The more you know about your options, the greater peace of mind you’ll have. Discuss with an insurance professional to find out what makes the most sense for your situation.

About the Author
Author

Ann Hayward

Born in Philadelphia and raised in the suburbs, Ann Hayward got her Pennsylvania real estate license at age 18 even before going to college. This second-generation real estate professional followed in the footsteps of her father and two uncles, inheriting their passion for the business. Licensed in DC, Maryland and Virginia, Ann is accomplished in her career, with numerous designations including SFR, SRES, PSA, WHC, and multiunit Housing Development Finance Professional (HDFP) from the National Development Council. She specializes in Prince Georges and Montgomery Counties, Northern Virginia and Washington, DC, all jurisdictions where Ann has lived and knows very well. In addition to her professional expertise, she owns and manages personal investment property, understands and has been involved in the renovation/remodeling process, and has great resources which she shares with clients. When you hire Ann to represent you, she will make your buying or selling experience an enjoyable, rewarding one. Her compassion, sensitivity to her clients’ needs, eye for detail, and ability to see the big picture when guiding you through a purchase or sale are unique assets that will ensure your success. A diverse and relevant background also gives Ann a distinct edge. For 30 years, she worked in fast-paced, high-pressure television and theatrical production, attaining the highest achievement – DGA membership as a Director, and as an award-winning staff and freelance writer. Her keen audio visual skills and design sense benefit sellers in marketing their properties, and are invaluable in helping buyers see the potential of space. A true renaissance woman, Ann was also an income tax professional and office manager for H&R Block, so she thoroughly understands the tax and financial implications of acquiring and selling real estate. Her superior organizational skills are further evidenced as owner of a downsizing/professional organizing business, Managed For You, which allows her to connect with everyone from millennials to boomers and seniors, whether for small space planning or assisting with major decluttering and transitioning. Ann holds an AB in American History from Simmons College, Boston, plus attended Robert Wagner Graduate School of Public Administration where she was a candidate for Doctorate. She additionally studied Film Direction at the American Film Institute in LA, and was a Stanford University post-graduate Professional Journalism Fellow. Personally, Ann is an avid if not very good golfer, and the co-founder of a nonprofit 501c3 organization offering educational guidance, tutoring and counseling for youngsters from elementary school through college admission. She sits on the board of trustees of a nonprofit educational film production corporation as well. (202) 494-6252 [email protected]