The risks to your wealth aren't only in the financial markets.
1. What is umbrella insurance? An umbrella insurance policy is extra liability insurance coverage that goes beyond the limits of the insured’s home, auto or watercraft insurance. It provides an additional layer of security to those who are at risk for being sued for damages to other people’s property or injuries caused to others in an accident.1 If you have umbrella insurance, it pays the difference between what your primary insurance covers and what you still owe.2
2. Why might you need umbrella insurance? The wealthier you become, the more you are a target. We live in a litigious world where even friends and neighbors can be convinced to see opportunity in the wake of an accident or misfortune. A large lawsuit can wipe out not only your current savings but also what you stand to earn in the future.2
3. How much umbrella insurance should I have? Would you want to be subjected to a significant drawdown in your personal assets to settle a lawsuit? Ideally, you have umbrella liability coverage with a limit that equals or exceeds your net worth.
4. Is umbrella insurance expensive? Premiums are reasonable and may be well worth the cost: $1 million of coverage commonly costs $150 to $300 per year, according to the Insurance Information Institute. The extra cost can provide peace of mind knowing that your assets are insulated from lawsuits.
Consider reviewing your insurance plans to help protect your wealth.
Guarantees are based on the claims paying ability of the issuing company.