Being named as the at-fault party in a car accident means that your insurance policy might come into play. Many states require liability policies for this reason. They help third parties receive financial help from at-fault drivers' insurance policies.
But, what if you come to find out your liability coverage won’t cover any or all the third party’s injuries? This is case where it may be beneficial to carry personal umbrella insurance.
Personal Umbrella Insurance for Auto Policies
Let’s say that you run a red light. You collide with a car moving through the intersection. The wreck causes vehicle damage and injures the driver and passengers of the other car. Because you ran the red light, the authorities and your insurance company may name you the at-fault party in the accident. This essentially means that your negligence led to the accident.
The injured parties on the other vehicle may want to use your auto liability coverage to assist with their medical needs. But, your liability policy has limits. Maximum values and exclusions may not allow the victims to get the funds they need. This may open the at-fault driver to out-of-pocket costs.
That’s where umbrella liability coverage may help. Umbrella liability coverage can extend the limits of your standard liability policies. Third party victims may have access to more funds. Umbrella coverage might also cover risks otherwise excluded from a standard liability policy.
Let’s say you have $100,000 of bodily injury liability coverage. However, the combined injury expenses for the victims of the car accident may total $500,000 or more. If a standard policy maxes out at $100,000, the at-fault party may still have to pay up to $400,000 out of pocket. Can you really afford $400,000 in damages? With umbrella coverage, you may be able to get the $400,000 extra coverage you need.
Getting Personal Umbrella Coverage
When you get umbrella coverage, you still have to make coverage decisions. Umbrella coverage, like liability coverage, is still an insurance policy. You have to make sure it addresses your specific risks.
- Umbrella policies still come with insurance limits. Work with your insurance agent to get the appropriate higher limits.
- Make sure your policy works in conjunction with your standard auto liability coverage.
- Generally, the price of an umbrella policy is much less than any claim a policyholder could face. However, make sure you still get an affordable price for coverage. It could help you keep the policy active
The right umbrella insurance can help many drivers in case they are at-fault in accidents.
Need Agoura Hills auto insurance? Call Gary Warner Insurance Agency, Inc. at (818) 706-8625 for a fast, free quote.