Don't Be Up the Creek Without a Paddle
By: Meagan Baron
January 28, 2020
If you are native to Western Washington you know that umbrellas are often scoffed at here. Many people you know embrace the rain, don’t they? Or, they simply think it is not worth carrying an umbrella around—that’s what hoods are for, right? Umbrella insurance is unfortunately treated the same way a lot of times—that’s what standard coverage is for, right?
Wrong. While standard coverage is good to have, it might not be enough to protect you from a monsoon…getting into a huge car accident that you caused, being sued for libel over something your teenage daughter said on Facebook, having to pay hefty medical bills for someone your dog attacked, being served a lawsuit brought on by a disgruntled former employee who claims prolonged racism in the workplace…The list is endless. If being human has taught us anything it is that every day brings new creative ways for accidents and injuries (just ask ER nurses). Anything can happen—is your standard coverage ready to take it on?
Umbrella coverage is something that all kinds of people and businesses have determined is very necessary to add to their current auto, home, and commercial policies. BIG storms happen. They can be completely unforeseen and cause some serious financial damage that can last for many years.
If there was an affordable way to keep you more protected at home, on the road, and in your business, would you do it?
What is Umbrella Insurance?
How does umbrella insurance work?
Umbrella insurance increases the liability of your policies, helping protect you if you injure someone, destroy someone’s property, and/or need to go to court.
What does umbrella insurance cover?
Umbrella insurance can be added to your current personal and/or commercial insurance policies.
We can help you add umbrella coverage to your...
- Personal/commercial auto insurance
- Personal/commercial boat insurance
- Homeowner’s insurance policy
- Renters insurance policy
- Landlord’s insurance policy
- Combined policies (i.e. home and auto)
- And more!
In addition to umbrella insurance giving you excess liability coverage for policies like those mentioned above, it provides defense coverage if you are accused or deemed at fault for an accident. Umbrella insurance can cover legal fees even if you are deemed not at fault.
Accidents happen. And, when they do, they can cause a debt catastrophe…up the creek without a paddle as the waves crash and rain pours. Are you ready to pay out of pocket if your standard policy limits can’t catch up?
How Can That Really Happen to Me?
Let’s say you are being sued for injuring two people and totaling their vehicles in a car accident that you caused. The bodily injury and property damage costs will add up fast, as will the amounts of stress as you worry that your auto policy won’t be able to cover it all. After all, one of the cars in the accident was a Ferrari, and other car…Well, it was a brand-new Tesla owned by a doctor who suffered serious injuries.
If we fast-forward a little bit…what is the verdict? First off, while the Ferrari driver only suffered a broken leg, the doctor had to have major surgery on her arms and hands and has not been able to work for 6 months and counting. Even though you had high liability coverage, you reached your coverage limits very fast and then some. You maxed out bodily injury liability and property damage coverage without paying for it all, plus your policy doesn’t cover lost wages, so that doctor must be compensated some other way for missing work.
If you had umbrella coverage on your auto policy, it would have kicked in once your auto policy was maxed out, helping pay for further medical bills and car repairs. It also could have broadened your auto policy coverage to include things like lost wages and the court fees that ensued when the other drivers sued you. But, since you didn’t have umbrella coverage, those extra expenses you’ve been ordered to pay will be out of pocket.
A year has passed now. Your insurance covered all of the medical bills for the Ferrari owner, but you ended up having to pay him a couple thousand for extended repair costs to his car that exceeded the cap amount. As for the doctor, she was able to make a full recovery after 10 months, but you did not have nearly enough money in the bank to cover her medical bills, car damages, and compensation fees. Since you could not come up with it all, your expensive assets—like your home and boat—went up for grabs to help pay for the fees. Even though you were forced to sell all that property and move to a small apartment, you still owe some money.
After filing for bankruptcy, things are not getting much better. Your future wages and assets you haven’t even acquired yet will be on the line until those bills and the interest is paid off. You are a sitting duck in the meantime. Seems almost improbable, doesn’t it?
This is not a scare tactic. It’s possible reality. Unfortunately, we hear stories like this more often than you might think. You can read about similar settlement cases that happened in Washington on personal injury lawyer websites like this one.