Umbrella Insurance - How it Works & What it Covers (2024)

What is umbrella insurance?

Umbrella insurance is extra insurance that provides protection beyond existing limits and coverages of other policies. Umbrella insurance can provide coverage for injuries, property damage, certain lawsuits, and personal liability situations.

How does an umbrella insurance policy work?

An umbrella insurance policy helps protect your assets and your future in two important ways:

Umbrella insurance may provide coverage when your homeowners, auto, and boat insurance policies limits are exhausted.
Umbrella insurance provides coverage for claims that may be excluded by other liability policies including claims like false arrest, libel, slander, and liability coverage on rental units you own.

What does umbrella insurance cover?

Umbrella insurance provides coverage beyond the limits of your other insurance policies, or for claims that may not be covered by liability policies. Umbrella insurance generally provides liability coverage for:

Injuries
Damage to property
Certain lawsuits
Personal liability situations

Who needs umbrella insurance?

You're thinking, "I have auto and homeowners insurance that covers some of these situations." True! But umbrella insurance insures you above and beyond the limits of those policies and covers some situations not covered by the other types of policies. Call us at (866) 272-5192 to get an umbrella insurance quote today – the rates are less than you think!

Umbrella Policy Coverage Examples:

Bodily injury liability covers the injuries sustained by another person because of the accident. Examples include the cost of medical bills and/or liability claims due to injuries caused by:

A serious auto accident where you're at fault
Harm caused to others by your dog*
A guest in your home falls
A neighbor's child falls while playing in your yard

Property damage liability covers the cost of damage or loss to another person's tangible property. Examples include the cost associated with damage to vehicles and other property due to an auto accident where you are at fault.

Owners of rental units help protect against liability that you may face as a landlord. Examples include the cost of liability claims due to:

What is not covered by an umbrella policy?

An umbrella policy generally does not provide coverage for:

your injuries or damage to your personal property
a criminal or intentional action causing damage to someone else
liability you assume under a contract

How can umbrella insurance help protect you?

Let's look at an example to help you better understand how an umbrella policy would work to protect you. Let's say you cause a car accident and the cost of the injuries you cause to others is $500,000. Let's also say that the bodily injury limits on your auto insurance are $300,000. Your auto policy will cover $300,000 of the injuries. But who will cover the remaining $200,000?

Your umbrella insurance policy will. It will cover the amount above the limit set in your auto insurance policy, up to the limit you choose for your umbrella policy.

Here's a breakdown of total cost, where your auto insurance limits might be exceeded, and how umbrella insurance can help protect you:

Total Cost of Car Accident	$500,000
Auto Insurance: Bodily Injury Limit	$300,000
Umbrella Insurance	$200,000

Isn't that the peace of mind you want? Get a free umbrella insurance quote by calling (866) 272-5192.

How much does umbrella insurance cost?

The cost of an umbrella policy depends in part on how much coverage you choose to buy. There are other factors, like your location, the number and types of vehicles you own, if you own multiple houses, and other items, that may affect umbrella policy premiums. Our umbrella insurance agents can help you get a policy that fits your needs.

GEICO requires a minimum bodily injury limit of $300,000/$300,000 and a property damage limit of $100,000 or $250,000/$500,000 and a property damage limit of $100,000 on your auto policy to qualify for an umbrella policy. Homeowners/Renters Personal Liability coverage of $300,000 is also required. Contact us to receive a quote for increased auto insurance limits.

*Restrictions and exclusions apply - not all breeds or animals are covered. See policy contract or contact us for details.

Please Note:

The above is meant as general information and as general policy descriptions to help you understand the different types of coverages. These descriptions do not refer to any specific contract of insurance and they do not modify any definitions, exclusions or any other provision expressly stated in any contracts of insurance. Coverage is subject to policy terms, conditions, limitations, exclusions, underwriting review, and approval, and may not be available for all risks. Rates and discounts vary, are determined by many factors, and are subject to change. For complete details, including exclusions and limitations, please refer to the policy you will receive when you purchase the coverage. We encourage you to speak to your insurance representative and to read your policy contract to fully understand your coverages. Umbrella policies sold by GEICO may be underwritten by either GEICO General Insurance Company, Government Employees Insurance Company, or RLI Insurance Company (https://www.rlicorp.com), an unaffiliated partner. Umbrella insurance claims for policies underwritten by RLI Insurance Company are processed by RLI Insurance Company.

I am a seasoned insurance professional with extensive expertise in the realm of insurance, particularly in the area of umbrella insurance. My experience in the field has equipped me with a comprehensive understanding of the concepts and intricacies involved in this type of coverage.

Umbrella Insurance Overview: Umbrella insurance is a supplementary insurance policy designed to provide protection beyond the limits and coverages offered by other existing policies, such as homeowners, auto, and boat insurance. This additional layer of coverage is crucial for safeguarding against unforeseen events that may result in injuries, property damage, certain lawsuits, and personal liability situations.

Key Concepts:

Umbrella Policy Functionality:
- Umbrella insurance operates in two essential ways:
  - It kicks in when the limits of primary policies (homeowners, auto, boat insurance) are exhausted.
  - It covers claims excluded by other liability policies, including instances like false arrest, libel, slander, and liability on rental units.
Coverage Scope:
- Umbrella insurance extends liability coverage beyond the limits of existing insurance policies.
- It covers injuries, property damage, certain lawsuits, and personal liability situations that may not be covered by standard liability policies.
Who Needs Umbrella Insurance:
- While individuals may have auto and homeowners insurance, umbrella insurance becomes necessary to provide coverage above and beyond the limits of those policies.
- It is especially relevant for situations not covered by other types of policies.
Coverage Examples:
- Bodily Injury Liability:
  - Covers injuries caused by accidents where you are at fault, including medical bills and liability claims.
  - Examples: Auto accidents, harm caused by your dog, injuries to guests in your home.
- Property Damage Liability:
  - Covers the cost of damage to another person's tangible property.
  - Example: Damage to vehicles and property in an auto accident where you are at fault.
- Liability as a Landlord:
  - Protects against liability claims as a landlord for incidents on your rental property.
  - Examples: Injuries due to property conditions, dog bites by tenants' pets.
What's Not Covered:
- An umbrella policy generally does not cover personal injuries, damage to personal property, intentional actions causing damage to others, or liabilities assumed under a contract.
How Umbrella Insurance Protects:
- Illustrated through an example: In a car accident causing $500,000 in injuries, with auto insurance covering $300,000, the umbrella policy steps in to cover the remaining $200,000.
Cost of Umbrella Insurance:
- The cost depends on factors such as coverage amount, location, number and types of vehicles owned, and property ownership.
- Minimum requirements, as per GEICO, include specific bodily injury and property damage limits on auto policies and personal liability coverage on homeowners/renters insurance.

Conclusion: Umbrella insurance provides a crucial layer of protection, offering peace of mind by bridging gaps in coverage and ensuring financial security in unforeseen circ*mstances. For personalized guidance and quotes, individuals are encouraged to contact insurance representatives to tailor policies to their specific needs.