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Personal Lines - Umbrella Liability
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If you are ever sued, your
standard homeowners or auto policy will provide you with some liability coverage, which
pays for judgements against you and your attorney's fees, up to an amount set in the
policy. However, in our litigious society, you may want to have an extra layer of
liability protection. That's what a personal umbrella liability policy provides.
It kicks in when you reach the limit on the underlying liability coverage in a homeowners,
renters, condo or auto policy. An umbrella policy will also cover you for things such as
libel and slander.
For about $150 to $300 per year you can buy a $1 million personal umbrella liability
policy. The next million will cost about $75, and $50 for every million after that.
Because the personal umbrella policy goes into effect after the underlying coverage is
exhausted, there are certain limits that usually must be met in order to purchase this
coverage. Most insurers will want you to have about $250,000 of liability insurance on
your auto policy and $300,000 of liability insurance on your homeowners policy before
selling you an umbrella liability policy for $1 million of additional coverage.
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