What Is an Umbrella Policy and Do I Need One?

An umbrella policy is extra liability coverage that sits on top of your home and auto policies, kicking in when those underlying limits are exhausted. It is relatively inexpensive and worth considering if you have assets to protect or any meaningful liability risk.

An umbrella provides a large layer of liability coverage, often $1 million or more, above your other policies. If a lawsuit exceeds your home or auto liability limit, the umbrella covers the rest, up to its own limit. It also often extends to cover some claims that your underlying policies do not.

To buy an umbrella, insurers usually require you to carry a minimum level of liability on your home and auto policies first. The umbrella then becomes an affordable way to buy far more protection than you could get from the underlying policies alone.

An umbrella makes sense if you own a home, have savings and investments, or face everyday liability risks like a dog, a pool, or frequent guests. A single serious accident or lawsuit can exceed the liability limits on a standard homeowners policy, putting your personal assets at risk.

For many Pennsylvania homeowners, an umbrella is one of the best values in insurance. The premium for a million dollars of extra coverage is often modest compared with the assets it protects. Ask your agent for a quote alongside your home and auto policies.