From your auto insurance to your home insurance, each policy protects your nest egg. If you are in a car accident or your home is damaged by a fire, it’s likely that you can count on your insurance policies to help you recover. But what happens when you don’t have enough coverage? 

Understanding Insurance Limits 
Although you’ve seen your declarations page and you’ve looked at your policy limits, you may not completely understand what it means. Insurance coverage limits are monetary caps on your policy. In essence, if your liability exceeds the limits of your policy, then you will likely have to pay the difference out-of-pocket. 

Let’s say you have the minimum required auto insurance, which doesn’t provide you with high liability coverage. While driving one day, you accidentally drive into someone’s home. Or, you are in an at-fault accident with a driver who happens to be driving a sporty, European car. Odds are, basic liability will not be enough to cover what you’re responsible for paying to make your victims whole. Fortunately, you can prevent excess liability exposure by purchasing personal umbrella insurance. 

What is Personal Umbrella Insurance? 
Personal umbrella insurance is extra liability coverage you can purchase through your insurance provider. It can add more coverage to your existing insurance policies. Typically, if you find that you are responsible for monies above and beyond your liability coverage, then you may be able to file a claim on your personal umbrella insurance to help cover the cost. 

Who Needs Personal Umbrella Insurance? 
Since personal umbrella insurance is an optional insurance, you may wonder whether you need it or not. The best way to determine whether purchasing a policy is in your best interest is to compare the cost of increasing your existing coverage limits to the cost of purchasing an umbrella insurance. However, you can’t simply compare costs; you have to compare the amount of coverage you get as well. 

Most people will find that purchasing an umbrella insurance policy is beneficial. Instead of simply giving you more coverage for one particular type of liability, personal umbrella insurance can help cover many of your liabilities. By securing a personal umbrella insurance policy, it’s possible you won’t have to touch your savings account, allowing your family to maintain the lifestyle they’ve grown to love. 

Do you have enough coverage? Call McDonald Insurance Group for more information on umbrella insurance.