Why do I need an umbrella policy?


Whether it's car, home, health or life, everyone will at some point need insurance. With that in mind, Bankrate sat down with some of the top experts in the insurance field to get their thoughts on the industry and what consumers need to know.

Graphic: What should I know about Umbrella Insurance?

Madelyn Flannagan, Vice President of Educational Research and Agent Development, Independent Insurance Agents and Brokers of America:

Umbrella policies can cover you over and above the liability that's afforded by your auto policy or your homeowner's policy or even your boat owner's policy. If someone is hurt or you damage a very expensive car and it exceeds the limit of liability that you have under those policies, an umbrella policy can provide you that extra layer of coverage that you need. Typically purchased in layers of one million dollars, it can cost as little as a hundred and fifty dollars per million, it's highly recommended that consumers that have high net worth or are driving a lot or have a high value home consider purchasing an umbrella policy.

Jim Whittle, Chief Claims Counsel, American Insurance Association:

If you don't have adequate insurance they may be coming after your home. They may see to take your house from you. They may see to take your assets, your automobiles, your motor vehicles, your boats, whatever you have. So an umbrella policy might be a useful way for you for what is relatively a small amount of money to have a substantial amount of money through an insurance product protecting you in case you have a large loss. Let's say somebody you are involved in an accident with becomes a quadriplegic that could be in today's world 20 million dollars of lifetime care or more. So an umbrella policy helps you through those kinds of potentially catastrophic exposures.

To learn more or shop around for the best insurance rates, visit the insurance section at


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