Do I need a $1,000,000 umbrella policy?

Umbrella insurance is worth it if the value of your assets exceeds your auto or home liability insurance limits. Umbrella policies are relatively inexpensive so they are worth the investment if you have significant assets you’re looking to protect from costly liability claims.

Umbrella insurance provides additional liability coverage, typically starting at $1 million, and it usually costs at least $150 to $300 per year. Umbrella policies also cover certain situations that don’t typically fall under … read full answerliability insurance, like libel and slander.

How To Decide If Umbrella Insurance Is Worth It

1. Add up the value of your assets, including your home equity, personal savings, and retirement accounts.
2. Compare your assets to the limits of your auto or homeowner’s liability insurance policy. If your assets exceed the current limits, then you should consider getting umbrella insurance.
3. Consider any factors that would make you more likely to have a liability claim filed against you, like owning a swimming pool or a dog.

Most home or auto liability insurance policies can only be purchased with maximum limits of $300,000 or $500,000, depending on the insurer. While these limits may be high enough for the average person, wealthier individuals with more assets may need even more protection. That’s when umbrella insurance is worthwhile. To learn more, check out WalletHub’s guide to umbrella insurance.

A $1 million umbrella policy costs around $150 to $300 per year, with the cost increasing a small amount for every additional million. As with any insurance policy, your exact price will depend on individual risk factors, including the number of people in your household and how many cars and properties you own.… read full answer

A $2 million umbrella policy will cost about $75 more than a $1 million policy, by the way. Every additional million in coverage after that will add about $50 to the total cost.

Umbrella insurance provides liability coverage beyond the limits of an auto or personal property policy. For instance, policyholders can file an umbrella insurance claim if they are at-fault in a car accident that causes damage beyond their car insurance limits. Most umbrella policies also cover claims for things like libel, slander, and accidents that occur abroad.

To learn more, check out WalletHub’s complete guide to umbrella insurance.