What Umbrella Insurance Covers and What it Doesn't
Umbrella insurance is a type of insurance policy that provides extra liability coverage beyond the limits of your underlying homeowners, auto or boat insurance policy. It can protect you and your assets by providing coverage for damages, injuries or other losses that exceed the limits of your primary policy. However, before purchasing umbrella insurance, it's important to understand what it covers and what it doesn't.
What Umbrella Insurance Covers:
1. Bodily Injury Liability - Umbrella insurance provides coverage for bodily injury liability claims. This means that if someone is injured on your property or as a result of your actions, your umbrella policy could provide additional coverage beyond the limits of your primary policy.
2. Property Damage Liability - If you accidentally damage someone else's property, your umbrella policy could provide additional coverage beyond your primary policy.
3. Personal Injury Liability - Umbrella insurance also covers personal injury claims, including false arrest, defamation, invasion of privacy and slander.
4. Legal Fees - If you are sued and need to hire an attorney, your umbrella policy could cover legal fees beyond the limits of your primary policy.
5. Non-Covered Claims - Umbrella insurance policies can also provide coverage for claims that are not covered by your primary policy. For example, if your primary policy excludes coverage for certain types of accidents, your umbrella policy may provide coverage.
What Umbrella Insurance Doesn't Cover:
1. Intentional Acts - Umbrella insurance does not provide coverage for intentional acts. If you intentionally harm someone or damage someone's property, your umbrella policy will not provide coverage.
2. Business Activities - Umbrella insurance policies generally exclude coverage for business activities. If you run a business, you should consider purchasing a separate liability policy to protect your business.
3. Property Damage to Your Own Property - Umbrella insurance policies typically do not provide coverage for property damage to your own property. For example, if you accidentally damage your own car, your umbrella policy will not provide coverage.
4. Contractual Liability - Umbrella insurance policies generally exclude coverage for contractual liability. This means that if you enter into a contract that results in a liability claim, your umbrella policy will not provide coverage.
5. Criminal Activity - Umbrella insurance does not provide coverage for criminal activity. If you are convicted of a crime, your umbrella policy will not provide coverage.
In conclusion, umbrella insurance can provide important extra liability coverage, but it's important to understand what it covers and what it doesn't. If you're considering purchasing an umbrella insurance policy, talk to your insurance agent to make sure that you have the coverage you need. Remember, umbrella insurance policies are not a substitute for a primary policy, and you should always make sure that you have adequate coverage under your primary policy before purchasing an umbrella policy.