Umbrella insurance offers an extra layer of liability protection beyond the limits of your home, auto, or other insurance policies. It guards your financial assets when serious claims exceed primary coverage, giving peace of mind against costly lawsuits. However, despite its broad coverage, umbrella insurance policies have important exclusions you need to understand to avoid unpleasant surprises when you file a claim.

At Weeks & Associates Insurance Services, we want you to be fully informed about what umbrella insurance covers and just as importantly what it does not cover.

What Is Umbrella Insurance?

Umbrella insurance is a supplemental liability policy that provides additional financial protection when your underlying insurance (like auto or homeowners insurance) limits are insufficient to cover damages you're legally responsible for. Common scenarios include bodily injury claims, property damage, legal defense costs, and lawsuits involving slander or defamation.

Common Exclusions in an Umbrella Insurance Policy

While umbrella policies extend protection, they do not cover every risk. Here are some key exclusions commonly found in umbrella insurance:

• Your Own Injuries and Property Damage

  Umbrella insurance only covers liability for injuries or damage you cause to others. It does not cover your personal medical expenses or damage to your own belongings. For such coverage, you’ll rely on health insurance, personal injury protection, or property insurance policies.

• Intentional or Criminal Acts

  If you deliberately cause harm or commit a crime, umbrella coverage will not pay for resulting damages or legal consequences. For example, bodily injury or property damage caused intentionally by you is excluded.

• Business-Related Liability

  Personal umbrella policies typically exclude liabilities arising from business activities or property, even if the business is home-based. These risks require separate commercial or business umbrella insurance. For instance, if you operate a daycare from your home, liability claims from that business are not covered under your personal umbrella policy.

• Contractual Liability

  Liability claims stemming from breaches of contract are usually excluded. This means if you fail to meet obligations under a contract and are sued, the umbrella policy is unlikely to provide coverage.

• Certain Types of Vehicles and Watercraft

  Some umbrella policies exclude liability arising from certain recreational vehicles (RVs), boats, or aircraft unless you have primary coverage specifically for those.

• Pets and Breed Restrictions

  Liability for injuries caused by certain dog breeds may be excluded if your underlying policy excludes those breeds. Umbrella insurance covers liability only after underlying policy limits are exhausted but cannot cover what the primary insurer excludes.

• Family Member Injuries

  Many umbrella policies include a “family exclusion,” which means injuries or death of a family member caused by another family member are not covered.

Why Are These Exclusions Important?

Knowing the exclusions helps prevent false assumptions about what your umbrella policy covers and highlights areas where you might need additional insurance.

For example, if you own a business, relying on your personal umbrella policy for business liabilities leaves you exposed. Or if you engage in criminal or intentional behavior, no insurance will protect you from legal repercussions.

How to Ensure You Are Fully Covered

1. Review Your Underlying Policies

   Umbrella insurance requires you to carry certain minimum liability limits on your home, auto, or other policies before it kicks in. Ensure your primary policies meet these minimums.

2. Understand Policy Language

   Each insurer’s exclusions can vary. Read your umbrella insurance policy carefully or discuss with your agent to clarify any uncertainties.

3. Consider Business or Specialty Coverage

   If you run a business or own specialty vehicles, ask about tailored policies that cover those risks.

4. Work with Experts

   Consulting experienced agents like Weeks & Associates Insurance Services ensures your coverage aligns with your personal risks and financial goals.

Shield Your Assets with Confidence

Are you confident your umbrella insurance policy truly protects your financial future? Many people overestimate what umbrella coverage includes, potentially leaving gaps in protection that can cost thousands, or even millions, if a serious claim arises.

At Weeks & Associates Insurance Services, we specialize in comprehensive insurance reviews and personalized advice. Contact us today for a free policy review to make sure your umbrella insurance suits your unique situation. Don't wait until an accident or lawsuit threatens your peace of mind, let us help you safeguard what matters most.

Contact us today at Weeks & Associates Insurance Services or call to schedule your consultation now!

Frequently Asked Questions (FAQ)

1. Can an umbrella insurance policy cover my business liabilities?

   No. Personal umbrella policies generally exclude business-related claims. Separate business insurance or business umbrella policies are needed for coverage of commercial activities.

2. Will umbrella insurance pay for damages if I intentionally injure someone?

   No. Intentional or criminal acts are excluded from coverage, meaning you will be personally responsible for any resulting damages or legal penalties.

3. What happens if the claim exceeds my auto or homeowners insurance limits?

   Your umbrella policy provides extra liability coverage beyond those limits up to its own limit, often starting at $1 million. It kicks in after primary policies are exhausted.

4. Does umbrella insurance cover damages caused by my pet dog?

   It depends. Liability for dog bites may be covered, but many policies exclude certain dog breeds or types of injuries excluded in underlying policies. Check your specific policy and underlying homeowners or renters insurance for details.