Group Umbrella Insurance
What It Is…
It is a fact that wealthy people are targets for lawsuits, and when the plaintiffs win their lawsuits, they expect to receive large sums of money. With this being the case, individuals with high net worth need insurance policies that provide higher limits than auto insurance and homeowners’ insurance policies can offer. This is the purpose of group umbrella insurance. Group umbrella insurance gives wealthy individuals and companies that have executives earning large sums of money insurance policies that can protect them from all of their risks.
Who It Is for…
Group umbrella insurance is for a group of people. The people in the group must have a relationship between them, and there must be at least 10 or 12 people in the group. They may be within the same family, or they may work for the same company.
How It Works…
Your homeowners’ insurance policy has liability limits set at $300,000. After a party at your house, a guest slips and falls in your yard. The concussion she experienced led to extremely high medical bills, and she decides to sue you. The court awards your guest $1 million in damages. Your homeowners’ insurance will pay $300,000, but your umbrella insurance policy that has a $1 million limit will cover the rest.
Different Types of Coverage in Existence…
You also have the option of purchasing an excess liability insurance policy. This policy will also provide you with $700,000 in the event that you receive a judgement against you for $1 million, but it is a more restrictive policy than the group umbrella insurance policy.
Major Benefits…
If you don’t have an umbrella insurance policy, the assets you have acquired up to this point are at risk. Your future income is also at risk. If a court decides against you and requires you to pay the plaintiff more than your auto insurance or homeowners’ insurance policies can offer, you will be responsible for paying the difference. If you had plans to retire early, those plans would have to be put on hold. The best thing about group umbrella insurance is that you can be a part of a policy that will cost you a lot less money than an individual umbrella insurance policy.