Umbrella

An umbrella policy is the most cost-effective policy a person could buy.  Most people have never even heard of an umbrella, and even less know what they do.

In short:

1,000,000 dollar’s in coverage for $150 dollars a year.  The catch?

Increased underlying limits.

Most companies require auto limits of 250/500, and homeowners’ limits of at least 300,000.

What do they cover?

Umbrella policies are an additional layer coverage for your home/auto policies, along with providing coverage in “excess” situations where the aforementioned policies have been exhausted or have NO COVERAGE.  This kind of policy is critical for any well to do person or business.

What do they cover?

  1. Expensive legal fees to defend in a suit.
    1. The larger the case, the longer it will take to settle.  Many umbrella policies cover the defense of the insured as additional coverage, meaning the coverage limit is not part of the defense cost.
  2. Excess liability after auto/home insurance policies has been exhausted.

Examples of coverage with an umbrella:

  • Vacant land
  • Pools/trampolines
  • Business activity at home
  • Home Renovations
  • Parties/entertainment
  • Recreational vehicles
  • Dog bites
  • Damage to others’ property
  • A catastrophic auto accident or striking a pedestrian.
  • Landlord liability
  • Libel or slander- social media
  • sporting accidents such as a stray golf ball

Who needs an umbrella?

Individuals with a high net worth or great potential.  The average household income in Georgia is $58,756.  As a general rule of thumb, if a household brings in more than $100,000/year, you are the top 1%.

During lawsuits, the other party is looking for compensation.  Cash is king, but other assets can be liquidated.  Consider the equity in your home, vehicles, then savings and retirement.  Also, consider future earning potential.  How would a wage garnishment for the next x number of years affect your life?

For these reasons, this is another reason why TWG does not write auto policies lower than 100/300 for people who own a home.  People purchase a home for many reasons, but one of those reasons is equity.  Purchasing a home is the first step to acquiring wealth. Clients who have established credit, a downpayment, and committed to buying a home share characteristics of an individual with great than average earning potential.  We should, in turn, ensure that potential with higher than usual limits.

Cost

Umbrella policies can cost anywhere between $150-$500 for the first $1,000,000 in coverage depending on the client and company.  The secondary cost of an umbrella is increasing the auto/home liability limits to the underlying 250/500 and 300,000.

The reason umbrella policies are so cost-effective is that the risk is low.   First- even if there is a loss, the auto and homeowner’s policies are likely to step in and cover the majority of losses.  Very few losses exceed the underlying limits.  The small portion of claims that do exceed is then exposed to umbrellas.

What to do next?

Talk to an agent!  If 10 years as claims adjuster has exposed me thousands of claims, providing hundreds of examples where insurance has saved lives.  TWG has combined this experience with a number of insurance companies to make sure we are placing the right client with the right policy.

Still not convinced?  Check out our Google Reviews– Then check out our competition.