People tend to not understand, or not think about Umbrella Insurance…until they need it…It’s worth a quick read of this post…
Umbrella insurance is one of the most-commonly misunderstood types of insurance. Because it’s a bit difficult to understand and surrounded by myths, too many businesses go without it and regret it later. Let’s take a closer look at what umbrella insurance is, and settle some common misconceptions about it.
MYTH #1: It’s Basically A Bunch of Insurances Combined.
This is the most common misunderstanding about umbrella insurance. It’s not just a mishmash of combined insurance types. It’s actually an extension – additional coverage purchased beyond your existing plans of any kind. All commercial general liability policies max out at a certain dollar value. If you hit that limit due to an expensive lawsuit, you’ll be on the hook for additional costs unless you have an umbrella policy with a higher coverage level. Say, for example, that a customer is severely injured on your property when she slips and falls through a glass display case. She sues for $2 million in medical costs, legal fees, and lost wages – and she wins. If your commerical general liability policy maxes out at $1 million and you don’t have an umbrella policy, you’re responsible for the remaining $1 million.
MYTH #2: Your Existing Policy is Plenty of Coverage.
As the example above shows, your existing policy might be enough, or it might not be. It completely depends on the situation.[…]