The Umbrella Policy Offers Liability Protection | Business

Your personal responsibility is not something you think about much. If you haven’t experienced a situation where you have been found responsible for an incident, you may not have thought about it at all. However, in the modern world, most people have myriad liability exposures that they may not even be aware of.


You own a dog.

You own a horse, cow, or other large animal.

You own a lawnmower, ATV or other off-road vehicle.

You have a swimming pool, trampoline or other “attractive nuisance”.

These are just a few potential liability risks, but you can see that this applies to almost everyone. Additionally, the mere act of driving a car anywhere exposes you to potential liability in the event of a major accident.

You may have liability coverage built into your existing auto, home, or renter’s insurance, but this often has a limit, and often a small one.

A personal umbrella policy is an option to consider. An umbrella policy is essentially an excess liability policy that protects you in the event of calamity beyond what your normal policies cover.

Let’s take an example :

John’s dog has always been a good pooch, but after a recent injury he is more irritable than usual. A neighbor decides to visit John and accidentally steps on the dog’s tail. The dog bites the neighbor. The neighbor is waiting to see the bite and it gets infected. He ended up spending six weeks in the hospital, with a bill of $750,000.

He then decides to sue John for those bills, along with an additional $100,000 for pain and suffering. John’s home insurance policy includes liability protection, but it is capped at $300,000. Without an umbrella policy in place, John could be liable for $550,000.

As you can see, a conversation about a personal umbrella policy with your insurance agent is worth it.

Andrew Sargent is an insurance consultant with the Wright Legacy Group.

Andrew Sargent is an insurance consultant with the Wright Legacy Group.