What to do when regular insurance isn’t enough.

Personal Umbrella Insurance for New Yorkers

If you’ve ever worried about being sued, even briefly, it’s time to think about umbrella insurance. In New York’s litigious atmosphere, a large lawsuit can wipe out your savings and your future earnings. Even if you don’t have money to cover a massive settlement now, you could be stuck paying off the debt for years. Consider it your money’s safe haven.

What is Personal Umbrella Insurance?

Personal Umbrella, sometimes called excess liability, gives you extra coverage for damages that exceed your primary property or auto policy limits if you accidentally cause major injuries or property damage. It protects you and your family against devastating liability claims or judgements. Think pricey car accident or trampoline incident. It protects you in two ways:

  1. provides additional liability designed to kick in when the liability on primary policies has been exhausted.
  2. provides coverage for claims excluded by other liability policies such as libel, slander, or false arrest.

It’s hard to pinpoint exactly how much umbrella insurance you might need, but a good rule of thumb is enough to cover your net worth, which includes savings, assets and income. You never know how much a potential worst-case lawsuit could cost you, and your HCP agent can help guide you to the proper level of coverage and cost.

A vehicle accident fatality can bring a judgment of over $1 million.

Who needs Personal Umbrella Insurance?

This is not a required coverage, like auto insurance. It is usually purchased by people who own property, have significant savings and assets, or are worried about liability claims when they travel internationally. It’s also a good idea if you:

  • Own things that can lead to injury lawsuits (think pool, trampoline, dog)
  • Engage in activities that increase your chance of being sued, such as being a landlord , serving on a nonprofit board or volunteering, or coaching your child’s sports team.
  • Participate in sports where you could easily injure others (think hunting, skiing)

A Manhattan patient is being sued by her doctor for $1million for posting negative reviews online.

Why do I need Personal Umbrella Insurance?

A single large lawsuit can take your home, your savings, even future earnings. You could end up paying off a settlement for decades. You could be sued for:

  • Injuries to another party due to an accident where you are at fault, or for injuries sustained by a guest in your home, or a neighbor’s child who falls while playing in your yard.
  • Property Damage to another person’s property, such as damage in an auto accident where you are at fault, damage caused by your dog, or accidental damage to school property caused by your child.
  • Pain & Suffering or Lost Wages if the person you injured can’t work for months or is permanently disabled.
  • Activities such as slander or libel, malicious prosecution or shock/mental anguish.

Hosting large parties (more than 25 people) at home can increase your personal liability score.

Personal Umbrella Insurance Quick Facts

This is the policy you turn to if you’re sued for damages that exceed the liability limits of your auto, homeowners or boat policy. Coverage often applies anywhere in the world, and is inexpensive for the amount of insurance included. It covers:

  • Treatment for others’ injuries or funeral costs.
  • Damage to others’ property
  • Your defense costs, attorney fees and other charges associated with lawsuits
  • Incidents that your main insurance might not cover, such as libel, slander, defamation of character
  • Covers certain rental items for which you don’t have insurance, such as a boat.

Umbrella insurance does not pay for:

  • Your own injuries or personal belongings
  • Intentional or criminal acts
  • Business losses
  • Some policies exclude damages causes while using recreational vehicles, such as ATVs or Jet Skis. Ask your HCP agent.

How does it work?

An example can help illustrate how umbrella policies work. If you cause an auto accident and the treatment cost of the injuries to others is $500,000. But your auto insurance policy limits bodily injury to $300,000. Where will the remaining $200,000 come from? Your umbrella policy.

A long commute, taking long road trips, or spending a lot of time on the road can increase your personal liability score.

What are some common Personal Umbrella Insurance claims?

The number of scenarios in which someone may decide to sue you are innumerable, and if you’re judged negligent or liable, you’re on the hook. Consider:

  • Your professional pianist friend visits and falls on your icy stoop because you didn’t clear the steps. With a broken arm, he misses an entire symphony season and sues you for lost wages, as well as the cost of his extensive medical treatment and rehab.
  • Your daughter hates math class as well as the teacher. She makes several disparaging and false remarks about her teacher online. The teacher sues you for personal injury and is awarded $750,000 in damages.
  • You host a party for your teenage son and some of his guests bring alcohol. One of the guests was severely injured in an auto accident after leaving the party and the injury was attributed to his alcohol consumption. The court decides you should have prevented the consumption on your premises even though you didn’t provide the alcohol, and you’re on the hook for damages he caused.
  • You babysit for a six month old infant and leave her unattended in a walker for a moment. The child topples the walker, strikes her head and suffers brain damage. The parents sue you and the court finds you liable for $11,000,000 in damages.
  • Your friend is visiting and playing with your new dog. The dog bites her in the face resulting in multiple reconstructive surgeries. She sues you for her medical treatment as well as pain and suffering and the court finds you liable for $10,000,000.

The five most common umbrella policy claims arise from: 1. Dog bites, 2. Home accidents, 3. Falling trees, 4. Intoxicated guests, 5. Injured domestic workers.

What other coverages might I need?

  • Property –provides financial reimbursement for your property and possessions in the event of damage, theft, or other covered peril.
  • Life – protects your family and others who depend on you for financial support and can help cover funeral expenses. Life insurance can also play a role in building wealth and investments
  • Auto – if you have an auto, New York State law requires that motorists carry a minimum amount of liability insurance of $25,000 for bodily injury to one person, $50,000 for bodily injury to all persons, and $10,000 for property damage in any one accident. Mandatory “no-fault” coverage of $50,000 is also required. (https://www.dfs.ny.gov/consumer/faqs/faqs_auto.htm)

Most personal umbrella losses are related to auto accidents, with a 2013 analysis finding that 78% of claims and 87% of losses related to autos.

Why should I choose HCP?

Some insurers will offer you exactly what you ask for when you call for a quote. We think that’s only half our job. HCP has worked with New Yorkers for more than 100 years, and we understand the liability risks you face. We’ll start with questions about your hobbies and activities as well as your savings and assets to discover where your individual risks are. We’ll offer comprehensive guidance that will help protect you with the right level of coverage.

We’ll pair you with an agent who understands the risks that keep you up at night. Your agent is your advocate, providing personal service before, during and after you choose your policy. Many of our employees have been with us 15, even 25 years, and make their career here so you get to work with the same person year in, year out. No need to initiate someone new.

What if I have a claim?

We know how important it is to have someone who gets it when everything else is going wrong. Your Honig Conte Porrino agent is your advocate, ready to help you navigate the claim process, no matter which coverage is impacted: one agent, one call. We want you to be delighted every time you connect with us.