If you’ve ever been pitched an umbrella policy, you probably know the basics: an umbrella policy protects you beyond the limits of your existing insurance, paying out only when those limits are exceeded. It’s likely that you have been warned that an umbrella policy protects your assets in the case something should happen to you. And while that information is true, it leaves out something important: an umbrella also protects other people.
Consider this example: You have an auto policy that meets your state’s minimum requirements, which you feel is sufficient. But one day, you hit a man who is crossing the road. He has to go to the hospital.
Even though the accident is not this gentleman’s fault, he receives a hospital bill for $400,000. He submits this bill to your auto policy carrier. And because your auto policy can’t cover the full bill, he is forced to sue you for the cost of his medical bills. After all, you were responsible for the accident.
But do you have $300,000 to pay for the remainder of his medical bills? If you don’t, you’ll end up filing for bankruptcy. Now, bankruptcy may save you from financial ruin, but what about the man you hit?
If you’d had an umbrella policy both you and the unfortunate gentleman you hit would be able to continue to live your lives without the burden of a hospital bill that neither of you can afford.
An umbrella policy absolutely protects the insured party from financial ruin. And by doing so, it also protects the complainant from having to pay for legal counsel and their own medical care despite being without fault. Consider the difference an umbrella policy could make in this situation. Umbrella policies are very affordable, especially considering the value they provide to you.
Give us a call or visit AmeriAgency.com or call 615-209-9362 for more information on how an umbrella policy can protect you and your assets, as well as others around you.