The average driver will be involved in more than three accidents in their lifetime. In a world where people are more likely to seek legal action, and medical expenses are increasing, you need to make sure that you have the proper coverage at the time of those accidents. The best way to do that is through an umbrella policy. An umbrella policy provides additional liability insurance over your underlying liability policies such as an auto or homeowner’s policy. There are many misconceptions about umbrella policies.

Misconception #1: Umbrella policies are too expensive. The average homeowner with two cars and two drivers pays less than $250 a year for a $1 Million umbrella policy.

Misconception #2: I have enough coverage now. Most auto and homeowners policies provide $500,000 or less in liability coverage. When another party is injured, you could be responsible for their medical bills, lost income, pain and suffering, and legal bills. Those costs can quickly exceed the limits on your average homeowners and auto policy. Without an umbrella policy, you will be held personally responsible for those damages.

Misconception #3: I don’t have significant assets to protect. While this might be a reason for some people not to purchase an umbrella policy, if you plan on developing additional assets in the future, you might still need an umbrella policy. In many court cases, the liable party might be forced to pay the injured party from future earnings. By purchasing an umbrella policy, you are protecting the assets you have now and your ability to earn in the future.

Misconception #4: I am a great driver, and if I am in an accident, the other party will be at fault, and they will pay. Unfortunately, most people carry low limits on their auto insurance. If you are hit by one of these low limit drivers, your umbrella policy can cover you if you add uninsured/underinsured motorists coverage. This protects you from drivers who either have no insurance or insurance with insufficient limits. There are a lot of drivers in Ohio who only carry the $25,000 required by the state.

Interested in more information, contact your Brown & Associates Insurance professional for an umbrella proposal.