AndyBI’ve often said that insurance is one of the few products folks purchase that they hope they’ll never need to use.  It’s like death and taxes:  nobody ever wants to talk about it, or plan for the possible rainy days ahead.

While DeFusco Law represents individuals who have been harmed by others, we always review our clients’ insurance coverages to make recommendations about the types and amounts of  coverage our clients should have, with consideration given to whether they have significant assets (like one or more homes or investment properties), significant income or income earning potential, and their level of risk aversion in general.  I am frequently surprised to learn that some folks have a lot to lose in the event of a lawsuit, but have insufficient insurance coverage to protect them from such financial losses.

One of the easiest and most affordable methods to protect yourself from liability is through the purchase of a personal liability umbrella insurance policy.  These are policies that provide for additional liability insurance coverage, starting at $1 million, above and beyond coverages you already have for your autos, home and perhaps recreational vehicles.  The coverage is affordable (usually available at a cost of around $250 a year for every $1 million of coverage) and widely available.  Most importantly, an umbrella policy will provide the additional insurance protection required if you are ever named in a lawsuit arising out of a serious injury or death.

Insurance companies will require you to have minimum limits of underlying insurance on your autos, home and possibly recreational vehicles (usually at least $100,000/$300,000 on your autos and $100,000 on your homeowner’s policy) before they will issue you an umbrella policy.  So while an umbrella may not be an option for some of us, it is an option that we should all consider at some time in our lives, especially as we grow older and accumulate more in the way of assets and earnings.

I once represented a man who was working in his home when a twenty-year-old woman, who was engaged in a distracting “texting argument” with her boyfriend, drove her SUV right into the front of my client’s block home.  A piece of block struck my client in the face, resulting in facial fractures that required several surgeries to correct.  While the young woman had little in the way of assets, she was covered by a $1 million liability umbrella policy that her parents purchased.  As my client’s damages greatly exceeded the limits of the driver’s underlying $100,000 auto policy, the umbrella policy paid the additional sums needed to settle our client’s lawsuit against the young woman.  The settlement fully protected the woman (as the underlying auto policy and umbrella policy paid the entire settlement), and fully compensated our client for his life-altering injuries.

If you don’t already have one, consider asking your insurance agent today for a quote on a personal liability umbrella policy.  Even if that rainy day never comes, for a small price you’ll sleep better knowing you’ll stay dry if it does! 

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