Do I still need a personal umbrella insurance policy?
Hi Terry, I enjoy your work. My wife and I are both retired, in our 70’s, rent a small house, do not own any property, and are long term debt free. Our personal umbrella insurance policy is up for renewal in a few weeks. Is there a reason that we should renew our policy for the coverage it provides, or can we let it expire? I would like to know your thoughts on this issue. Thanks!
Terry Says
It’s always difficult to let go of an insurance coverage you’ve had for years. But in this case, since you are retired, and don’t own property, and thus unlikely to be sued for anything the policy covers, I’d say it’s pretty safe to drop it.
Here’s more info on what umbrella policies cover, and what they dont:
What Umbrella Policies Cover (Property Damage):
Liability for Damage to Others’ Property:
Umbrella policies offer an extra layer of protection if you’re found legally responsible for damaging someone else’s property, such as in a car accident or if your actions (or negligence) cause damage to a neighbor’s property.
Legal Costs:
They can also cover the legal fees associated with defending yourself in a lawsuit related to property damage.
Examples:
If your car accidentally crashes into a store, causing property damage, the umbrella policy can help cover the repair costs that exceed your auto insurance limits.
If your dog bites someone and causes injury and property damage, the umbrella policy can help cover the damages beyond your homeowners insurance limits.
If a guest is injured at your home and sues you, the umbrella policy can help cover the legal costs and potential settlements.
What Umbrella Policies DON’T Cover (Property Damage):
Damage to Your Own Property: Umbrella policies do not cover damage to your own home, car, or personal belongings. These are typically covered by your homeowners or auto insurance policies.
Intentional Damage: Umbrella policies generally don’t cover damage caused intentionally.
Business-Related Liability: Umbrella policies typically don’t cover liability arising from your business or professional activities. You would need separate business or commercial umbrella policies for that.
