How Does an Umbrella Insurance Policy Work?

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An umbrella life insurance policy covers a variety of different areas. Learn exactly how an umbrella insurance policy works with help from a dedicated insurance professional in this free video clip.

Part of the Video Series: Insurance Help
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Video Transcript

Hi, my name is Doug Levi. I'm principal agent and owner of Strategic Insurance Services. Today, I'm going to talk to you about how does an umbrella insurance policy works. I'm going to give you a little example here with the drawing. Here is an umbrella. Maybe not the prettiest, but maybe one of the most important you've ever seen. Under this umbrella you have your auto insurance, you have your home insurance. Maybe you have a boat. Maybe you have a rental property. Maybe you have vacant land. These are all underlying exposures. Each of them is going to have underlying liability coverage. What an umbrella does, is it goes above and beyond which is why I draw it like this and it's going to put a million dollars or more above and beyond your underlying limits. So, let me give you an example. Let's say your seventeen year old son gets into a car accident and hurts or kills someone. And you've got two hundred and fifty thousand dollars in your auto insurance liability, but you get sued for seven hundred and fifty thousand. Well what happens in that scenario? Well, if in that scenario you had an umbrella, you would have your auto insurance that would pay out the first two hundred and fifty thousand. Then, it would go to your liability umbrella which would protect you up to an additional million dollars. Oftentimes, liability umbrellas are very affordable. The typical policy is anywhere from two hundred and fifty dollars to three hundred and fifty dollars a year. I find it very valuable protection. We strongly recommend it to a majority of our clients. This has been how does an umbrella policy work. You can get more information on umbrella insurance at our website, which is Tampa Bay Insurance dot net. My name is Doug Levi. I'm with Strategic Insurance Services.

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