What is Geico's umbrella insurance policy?

You need an umbrella policy if your total assets exceed your car or home insurance policy limits or if you have a high risk of being sued. An umbrella policy is an optional form of liability insurance designed to supplement existing coverage, and it typically costs $150 to $200 annually for $1 million in coverage. As a result, households with a high net worth are the most likely to need umbrella coverage.... read full answer

When You May Need an Umbrella Policy

• Your assets are greater than your home or car insurance policy limits.
• Your occupation puts you at high-risk for a lawsuit.
• You own a trampoline, hot tub, or swimming pool.
• You ski, hunt, surf, or participate in another hobby where you could injure someone else.
• You own property, especially rental or investment properties.
• You have a dog with a restricted breed or a bite history.
• You are a public figure.
• You own guns.
• You frequently host guests.

A common rule of thumb is that households should have an umbrella policy if they have $1 million or more in assets. Umbrella policies are also a good investment for people whose assets will likely increase considerably in the future, as liability settlements can sometimes result in wage garnishment. For example, medical students are often advised to purchase umbrella coverage to protect their future income.

To purchase an umbrella policy, you will usually need a car insurance policy with high liability limits. For instance, Geico umbrella coverage requires at least $300,000 in bodily injury liability insurance and $100,000 in property damage liability coverage.

For more information, check out WalletHub’s complete guide to umbrella insurance.

You need enough umbrella insurance to make up the difference between your liability insurance limits and your net worth, in order to protect your assets if you are faced with a major liability claim or lawsuit. Umbrella insurance limits usually start at $1 million and can go as high as $10 million, depending on the insurer.... read full answer

A basic $1 million umbrella policy typically costs between $150 and $300 annually, with each additional $1 million in coverage adding up to $75 to the price. Since the cost is relatively inexpensive, it’s usually best to err on the side of getting too much umbrella insurance rather than too little.

Recommended Umbrella Insurance Coverage

It’s generally recommended that you buy enough umbrella insurance to cover your assets, including your home equity, personal savings, and retirement accounts. For instance, if your assets equal about $700,000, it’s a good idea to buy $1 million in umbrella insurance, since this is usually the lowest amount available.

Besides your own finances, you should also consider things that could increase your odds of being liable for someone’s injuries at some point, including owning a dog or having a teenage driver in your household.

Ultimately, it’s important to remember that if you don’t have enough insurance to cover your net worth, your assets could be seized to cover damages that exceed your liability insurance limits. Because of this, umbrella insurance is usually a wise investment for individuals with a particularly high net worth.

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

Stand-alone umbrella insurance is an umbrella policy that offers coverage to customers who use a separate provider for their home or auto insurance. Stand-alone umbrella coverage is not very common, and it is not offered by any major insurers. Umbrella insurance supplements the liability limits of a home or auto policy, after all, and an insurance company will almost always require customers to get all of the necessary coverage from them.... read full answer

Companies That Offer Stand-Alone Umbrella Insurance

• RLI Insurance
• American Alternative Insurance Corporation (AAIC)
• United States Liability Insurance (USLI)

Stand-alone umbrella insurance is a good option if you need higher limits than what your auto or home insurer offers, or if another company has cheaper coverage.

The starting rate for umbrella insurance is generally $150 to $300 annually for a $1 million policy. For each additional $1 million that you add to a policy, the rate will typically go up $50 to $75 per year.

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