Umbrella Insurance: Protection When Accidents Happen
Perhaps the best way to underline the importance of umbrella insurance in protecting your assets is by sharing an example:
“Over 15 years ago, my daughter was in middle school and my wife volunteered there. The school was just few miles away off a two-lane road. One rainy day my wife was driving to the school and came across deep water in the road. She had to make a left turn across the puddle, and while navigating the hazard she drifted into the oncoming lane. Another woman came barreling over the hill in a minivan and hit my wife’s car. Both women are injured and my wife was clearly at fault. Fast forward 9 months after the accident, the Sherriff comes to our front door and served litigation papers. We went through 2 years of back and forth, going through an investigation and hiring a personal injury attorney. My wife ended up being sued for everything – pain and suffering, lack of consortium, etc. The women ended up having three surgeries for a broken ankle she had sustained in the accident. We had a $500,000 limit of liability through our auto insurance, so if we received a judgement beyond that figure the rest would have come out of our own pocket. Fortunately, we also had a $2 million umbrella policy. The lawsuit almost ended up going to a jury trial. At the last minute the insurance company offered to settle for $750,000, $500,000 of which came from our auto policy and the rest from our umbrella policy. Turns out our insurance company passed our case to four different attorneys over the two years and was tired of fighting it, otherwise who knows how large the award would have been? Volunteering three minutes from home turned into a $750,000 mistake! If we had not had the umbrella policy, we would have been in dire straits.”
The cost of umbrella insurance is very small compared to the risks associated with accidents.
Do any of these situations sound familiar?
• Your family owns a lake or ski house with “dangerous” toys (jet skis, snowmobiles, boats, etc.) and visitors who use them.
• Your 16 year-old son or daughter is now driving and has a new car.
• You throw parties out by your pool that include alcohol.
• You have a dog.
Frankly, there is always the potential for an accident either caused by you or a family member or happens on your property. While umbrella policies are rarely used, when they are needed they are immensely helpful, saving people hundreds of thousands of dollars for a minimal premium.
The key is to make sure that you have enough coverage to suit your life – your homes, your toys, your hobbies and your family. Deep pockets are particularly at risk; if you are a business owner, an attorney could go after it too. The fact is, the larger your life the more someone can take from you. Medical coverage can be millions of dollars in itself, let alone the other issues included in personal injury lawsuits.
To ensure you have the correct amount of coverage for your situation, you need an insurance agent who has access to multiple options to draw from. One-stop-agencies have just one choice! Wharton & Power Insurance works with multiple providers, allowing us to tailor insurance coverage to the individual needs of our clients. While we hope you never have to tap into your policy, we will find the best protection for you, your family and your lifestyle. For more information, send me an email, or give me a call at 317.663.4138.
