Umbrella Policy Planning: Is It Time to Raise Your Limits?

As personal liability risks and legal settlements continue to rise, many individuals are asking: Is it time to raise your umbrella insurance limits? If you've ever searched for "umbrella insurance near me," you're already on the right path to protecting your assets and financial future.

What Is Umbrella Insurance?

Umbrella insurance provides an extra layer of liability protection that goes beyond the limits of your standard home, auto, or boat insurance policies. When a major accident or lawsuit exceeds your primary policy's coverage, umbrella insurance steps in to cover the remaining costs—helping you avoid devastating out-of-pocket expenses.

Typical Coverage Limits

• Starting limits: $1 million
• Higher limits: Up to $10 million or more, depending on your needs and risk profile

Why Consider Raising Your Limits?

Recent trends show a significant increase in both the frequency and size of liability claims. For example, insurers like State Farm have requested substantial rate hikes for umbrella policies due to "dramatically" rising personal liability costs, larger legal settlements, and more frequent claims. This environment means your current coverage may no longer be sufficient to protect your assets.

Real-Life Scenarios

• Auto Accident: If you're found liable for a multi-car accident with damages exceeding your auto policy's $500,000 limit, an umbrella policy can cover the additional amount—potentially hundreds of thousands of dollars.
• Home Liability: If a guest is injured at your home and sues for $1 million, but your homeowner's policy only covers $300,000, your umbrella insurance would pay the remaining $700,000, plus legal expenses.

Who Needs Higher Umbrella Limits?

Consider increasing your limits if you:

• Own significant assets (home, savings, investments)
• Have a high net worth or future earning potential
• Host guests frequently or own a pool/trampoline
• Have teenage drivers or own multiple vehicles
• Are concerned about lawsuits from accidents, libel, or slander

How Much Does Umbrella Insurance Cost?

• Typical cost: Starts at about $20 per month for $1 million in coverage.
• Incremental increases: About $75 for each additional $1 million in coverage.

Given the relatively low cost compared to the protection provided, raising your umbrella policy limits can be a prudent risk management decision.

1. Assess your total assets and potential liabilities.
2. Compare your current policy limits to your exposure.
3. Consult with a local expert—search for "umbrella insurance near me" to find an agent who can tailor coverage to your unique situation.

At D.M. Johnson Insurance Agency, we help clients navigate the complexities of umbrella policy planning. If you're unsure whether your current limits are enough, or if you're searching for "umbrella insurance near me," our experienced team can provide a personalized risk assessment and coverage recommendations.

Don't wait until after a claim to discover a coverage gap. Contact D.M. Johnson Insurance Agency today to review your umbrella insurance options and ensure your financial future is secure.