Do I Need Umbrella Liability?
When and if you are ever sued, your standard homeowners or auto policy will provide you with some liability coverage, paying for judgments against you and your attorney's fees, up to the policy limit . However, in our litigious society, you may want to add an another layer of liability protection. That's what a personal umbrella liability policy provides.
Your umbrella policy will kick in when you reach the policy limits on the underlying coverage. ( homeowners, renters, condo or auto policy) It will also cover you if your sued for libel and slander.
For about $150 to $300 per year you can buy a $1 million personal umbrella liability policy. You can get the next million for about extra $50 to $75.
Because the personal umbrella policy kicks after the underlying coverage is exhausted, there are minimum limits that must be met in order to purchase this coverage. Most insurance companies will require you to have about $250,000 of liability insurance on your auto policy and $300,000 of liability insurance on your homeowners policy before selling you an umbrella liability policy for $1 million of additional coverage.