When shopping for homeowner’s and auto insurance rates, you may come across one or more phrases you’ve probably never heard of. There are umbrella policies and dual liability policies. Umbrella policies provide coverage for any damages, losses, or liabilities that occur during a home or auto insurance policy coverage period. Dual liability policies, on the other hand, take the coverage of liability insurance from your homeowners or auto insurance policy and add it to your homeowners or auto insurance policy.
Why would you want to add a personal liability insurance to your homeowners or auto insurance? Probably because you are a property owner and you have had to file a homeowners or auto insurance claim in the past. Maybe, you were injured in an accident, and your homeowners or auto insurance company will not pay your medical bills. If this is the case, you need to consider purchasing a personal liability coverage policy. You can also save money if you have more than one person on your homeowners or auto insurance policy.
Many homeowners and auto insurance companies offer umbrella policies. They do this to protect you in the event you are sued by a third party who was injured on your property. An example of a third party who may sue you would be a tenant or guest. In the state of Washington, for example, a tenant who slips and falls on your property is required by law to provide you with personal liability coverage.
If you don’t have homeowners or auto insurance coverage but have a rental property, you may want to purchase a renter’s liability policy. A renter’s umbrella insurance policy would provide you with coverage if a visitor to your home or apartment was injured. The medical bills associated with such an injury would also be paid by the renters’ umbrella policy. This can provide you with financial protection should you get sued as a result of an injury.
However, before purchasing a renters’ umbrella policy it’s important to understand that it won’t cover you if your tenant or guest slipped and fell and suffered an injury. It will only provide coverage up to the extent that the liability limits have been reached under your homeowners or auto insurance coverage. For instance, if you purchased a $1,500 homeowners policy and your tenant or guest slipped and fell and became injured, your liability limit would be the total amount of the actual cash value of the item that was damaged or lost.
Another reason to purchase a homeowner or auto insurance liability coverage is if you are building a home or remodeling a home. A good rule of thumb is to purchase a larger umbrella policy if you’re making over $500K. For instance, if you’re making over this much money you probably want to purchase a much larger liability policy. On the other hand, a smaller homeowner policy won’t cover you if you’re a single person living in a rental dwelling.
What is a homeowners’ umbrella policy? In essence, it’s an insurance policy that covers you if you become injured while visiting somewhere that is not on your property. The only stipulation is that you must be on your own property when the accident occurs. So if you are visiting your friend’s place and slip and fall, you wouldn’t be covered if his guest was at home. If you purchase such a liability insurance policy, it means that whatever financial setback you may experience because of your injuries, you will not have to cover yourself financially.
It’s usually a good idea to purchase liability insurance because you never know what can happen. For instance, a heavy object falling on top of you could severely injure or even kill you. In order to protect yourself from such unforeseen events, you should make sure that you have adequate liability protection. With an umbrella policy, you’ll be able to recover from your financial losses in the case that you become injured because of somebody’s negligence.