So, you're thinking about purchasing an umbrella insurance policy. Depending on which sort of policy you purchase, it can cover different things. Generally, umbrella policies are there to pick up where your existing insurance fails. Not all umbrella insurance policies are the same. Here are some general ideas of what most insurance companies will and will not cover.
- Bodily injury liability
This means that umbrella insurance covers the cost of bodily damage done to someone else. This includes the cost of medical bills and liability claims. Any damages that you are legally responsible for will be covered as well as the legal defense should someone ever sue. An example of this would be if someone fell in your home and sustained a significant injury. If they broke their leg, you are responsible for all charges. Your umbrella insurance will cover the medical bills. - Property damage liability
This covers the damage done to someone else's tangible property. If there is an accident and you are found at fault, you are responsible for paying for any damages associated with the accident. The most common type of property damage is auto accidents. Car insurance may cover a certain amount, but it may not cover the entire cost of damages. Having an umbrella insurance policy will cover anything that your auto insurance fails to cover. - Rental units
As a landlord, you are responsible for your tenants in most situations. If they fall and hurt themselves on a sidewalk or on staircases that are improperly lit, you are responsible as the owner to pay for their damages. There are also some situations where if your tenant's pet bites another person, you may have to pay for the damages. Some insurance policies may not cover these situations, but having an umbrella policy will pay for any damages and lawsuits that come about through owning or renting a home. - Slander and libel
Reputations are extremely important in certain situations. When someone says something about you or your business, it can take have monetary losses. It becomes an even more serious matter when someone publishes it in a paper or on an online forum. These are examples of slander, when something untruthful is spoken, and libel, when something false is published. Most umbrella insurance policies will cover the court fees associated with cases of this type. - False arrest and malicious prosecution
If you are arrested under false pretenses, umbrella insurance policies will have your back. Being falsely arrested means you have been arrested without probable cause or without an order issued by a court of competent jurisdiction. Malicious prosecution may also be an issue similar to false arrest. This is when there is someone is when there is no base for suits filed against you. This can be done due to a lack of probable cause or any other purpose other than bringing the alleged to justice. An umbrella insurance policy will pay to clear your name in both of these situations. - Shock or mental anguish
Finally, many umbrella insurance companies will pay for shock or mental anguish. Shock or mental anguish occurs when someone suffers distress, anxiety, fright, depression, grief, or trauma. If someone claims that they have experienced this issue due to your actions, you may be sued. Court and attorneys fees will be covered in the event of this sort of lawsuit when you have an umbrella insurance policy.
