Best Umbrella Insurance Companies in 2023

best umbrella insurance

Umbrella insurance is a type of liability insurance that supplements other policies, known as underlying policies, with additional coverage. Auto, homeowners, and renters insurance policies are examples of underlying policies. Depending on the type of policy you select, your umbrella insurance company will cover either personal or commercial liability. Personal umbrella policies often cover the following types of claims: car accidents, dog attacks, swimming pool accidents, and slip-and-fall incidents. If you’re sued for more than your basic liability limitations, an umbrella policy can help pay your debts. If you’re a landlord, learn about umbrella insurance for landlords in this article. The best umbrella insurance policies are provided by trustworthy companies with years of experience in the insurance sector.

These policies will be reasonably priced, and suited to your specific needs. Also, they offer a variety of possibilities for both personal and business use. They will contain items like third-party claim protection.

How Umbrella Insurance Works

Consider the following scenario to gain a better understanding of how umbrella liability insurance might help:

You run a red light and collide with another vehicle. The vehicle has sustained substantial damage, and several individuals have been hurt. The car need $25,000 in repairs, and the injuries require $275,000. Furthermore, the other car’s driver is an orthodontist. And so, he will be out of work for months owing to a broken arm; he sues you for $200,000 in lost profits.

You’re liable for a total of $500,000. If you only have $300,000 in liability coverage with your automobile insurance, you will have to pay the remaining $200,000 out of your own money.

Umbrella insurance would cover the difference between what your regular insurance covers and what you still owe. An umbrella policy would also cover any legal fees incurred as a result of the litigation.

Umbrella Insurance for Landlords

The first priority of a landlord is to protect their investment. A positive return on investment is directly proportional to the presence of a functional rental with high-quality renters. However, unexpected natural disasters or tenant claims sometimes occur. So, being adequately insured is a crucial component of ensuring a rental property’s long-term financial success. Most homeowner’s policies will not cover a rental property. If the rental does have a mortgage, the bank will almost certainly want a separate policy. The majority of landlords will obtain a landlord liability policy to protect themselves from potential tenant claims.

What is covered under landlord liability insurance? While policies and coverage vary, it will almost certainly cover a claim brought by a tenant in which the landlord was perceived as the liable party and may have failed to maintain the property’s safety. For example, if a tenant fell on the door jam while leaving their apartment and broke their toe, they may bring a claim alleging that the landlord failed to properly maintain the rental.

If the landlord was determined to be negligent, a regular landlord policy would usually cover the claim. However, there are some conditions and occurrences that may exhaust landlords liability insurance coverage; in these cases, an umbrella policy can pick up the slack, and it is a cost-effective approach to protect your assets.

Read Also: MUSIC PRO INSURANCE: Insurance For Your Musical Equipment

How Much does an Umbrella Insurance Policy Cost?

A $1 million umbrella policy will cost between $150 and $500 each year, according to the Insurance Information Institute. Umbrella policies typically contain minimum conditions that must be met as well. A landlord, for example, cannot have a minimal minimum liability policy plus a more reasonable umbrella policy. They must have another insurance policy that is covered by the umbrella insurance; if they don’t, they may be compelled to acquire a stand-alone umbrella policy with its own defined coverage and rates.

The best bet for landlords is to choose an insurance company that provides both landlord liability and umbrella insurance. The coverage, deductible, and premium for each landlord will differ based on their needs and assets. So meeting with a qualified professional who can tailor a policy and plan is the best course of action.

Insurance companies frequently provide discounts for combining policies, which can assist in reducing your overall insurance rates. It’s also worth noting that a policy with a cheap annual premium can have a high deductible. If a landlord loses a case, they must pay the deductible before the coverage will pay out.

What does umbrella insurance cover?

Depending on your policy, umbrella insurance protects you and members of your household from various lawsuits. These include personal injury to others, damage to other people’s property, and a number of claims such as defamation, landlord responsibility, and wrongful imprisonment.

In addition to paying out any damages up to your liability limit, your insurance will usually cover any further legal costs. For example, if you have an umbrella policy with $1 million in liability coverage and are sued for the whole amount, your insurer will pay you the $1 million-plus offer legal defense or cover your legal bills. A “retained limit” may apply. This is comparable to a deductible in that you must pay it before your coverage begins to pay out.

Details and exclusions vary greatly between different policies, but here are a few examples of what insurance covers:

  • Your adolescent son is involved in an automobile accident, and the expense of injuries to other drivers exceeds your auto insurance policy limit.
  • A houseguest falls down your stairs and sues you for her medical bills and pain and suffering. And these exceed the liability limit on your homes insurance.
  • A restaurant sues you for leaving a poor online review.

What umbrella insurance doesn’t cover

Umbrella insurance does not cover your own injuries or property damage; for that, you’ll need to obtain additional coverage (such as health insurance or collision coverage on your auto insurance). It will also not cover liability related with your business unless you get a commercial umbrella policy rather than a personal one.

Most policies exclude liability resulting from a breach of a contract. For example, if a roofing company sues you because you haven’t paid for the job performed under the contract you signed, your umbrella insurance policy is unlikely to be of assistance. And if you intentionally injure someone or commit a crime, you’re almost probably not insured.

Boats are another popular exclusion. Some companies only cover specific sizes or types of watercraft. However, some others do not cover them at all unless you already have a boat insurance policy.

Best Umbrella Insurance Companies

#1. Allstate – Best Umbrella Insurance for low premiums 

Allstate provides the best insurance for the lowest cost. Their rates range from $60 to $120 per year for $1 million in coverage. Because of individual risk considerations, each customer’s rate will vary, although Allstate’s customer service professionals offer pricing that is lower than competitors’.

Allstate umbrella insurance protects against bodily injury, personal injury, property damage, and landlord liability claims. For example, an Allstate umbrella policy can cover legal fees incurred as a consequence of a lawsuit, lost wages as a result of a court appearance, and incidents that occur abroad.

#2. Liberty Mutual – Best Umbrella Insurance for competitive pricing

Because customer service personnel state they will try to match another company’s price, Liberty Mutual has the best umbrella insurance for cheap pricing. Liberty Mutual umbrella policies start at $1 million in excess liability coverage, with higher levels available.

Umbrella insurance from Liberty Mutual extends liability coverage beyond the limits of existing policies, such as auto, watercraft, and homeowners insurance. It also covers liability claims for specialized scenarios such as malicious prosecution, libel, false arrest, wrongful eviction, and invasion of privacy. Policyholders and their household members receive protection regardless of where they are in the world.

#3. USAA – Best Umbrella Insurance for Military Personnel

For qualifying clients, such as servicemembers, veterans, and their families, USAA offers the best umbrella insurance. The policyholder, their spouse, and any other relatives living in the same household are all covered by USAA insurance. Aside from libel, slander, and invasion of privacy claims, USAA umbrella policies can also cover car accidents and accidents at the policyholder’s home or leased property.

Umbrella policies from USAA typically have limits of $1 million to $5 million, but higher amounts may be available. To be eligible for USAA umbrella insurance, policyholders must have an automobile insurance policy with the company

#4. Chubb – Best Umbrella Insurance for High Liability Limits 

Because it provides coverage ranging from $1 million to $100 million, Chubb is the best umbrella insurance company for high liability limits. Chubb insurance covers liabilities after a car accident as well as liability claims arising from occurrences on the policyholder’s property. Furthermore, it covers for most litigation defense costs, and the coverage is global.

Chubb, in general, serves to richer clientele, and its rates may reflect this. It’s also worth noting that Chubb has received high financial stability ratings, including an AA from Standard & Poor’s and an A++ from A.M. Best. As a result, Chubb consumers can be confident in the company’s financial stability.

#5. Travelers – Best Umbrella Insurance for Business Owners

The company has the best umbrella insurance for business owners because the company advertises a wide range of commercial umbrella coverage alternatives. Travelers recommends its umbrella policies for firms whose employees drive on the job and/or engage with vendors or customers on a regular basis.

Another significant advantage is that Travelers offers umbrella insurance for firms that might otherwise struggle to acquire coverage. This includes companies with “difficult-to-place risks.” Just keep in mind that in order to qualify for the company’s umbrella coverage, businesses normally need to have their general liability insurance with Travelers.

Non-business owners can also acquire a personal umbrella policy from Travelers, but they must have a personal auto policy with the company in order to qualify.

Tips for Buying the Best Umbrella Insurance

#1. Get an umbrella quote from your auto or home insurance company.

Most major vehicle insurance companies will only write umbrella policies for existing clients, though this varies by state. Umbrella insurance is typically less expensive than auto or home insurance, so switching companies for a reduced umbrella cost may not be worth it.

#2. Increase the liability limitations on your other policies.

Before selling you an umbrella policy, insurance companies frequently need you to meet specified coverage levels on your home and/or car insurance policies. Many insurers, for example, require customers to have a minimum of $100,000 or $250,000 in bodily injury liability per person on their motor policy.

#3. Select coverage limits that are appropriate for your assets and take into consideration future income.

When determining how much insurance to purchase, keep your whole net worth in mind. If you are sued for damages, your assets and income may be at risk, and your future paychecks may be garnished. As a result, you should cover the value of all of your assets, including vehicles, real estate, retirement accounts, and investments, by the umbrella policy. Even if you don’t have many assets right now, you should buy umbrella insurance if you expect to have a larger net worth in the near future.

In Conclusion,

Allstate, Liberty Mutual, and USAA are the best umbrella insurance companies because they offer comprehensive coverage at a fair price. Furthermore, Travelers offers the best umbrella coverage for business owners, whereas Chubb is best for consumers who require extremely high liability limits.

Best Umbrella Insurance FAQs

How much is a i million dolllar umbrella policy cost?

According to the Insurance Information Institute, an umbrella policy with $1 million in coverage costs between $150 and $300 per year. Umbrella insurance, with its large coverage limit, often provides good value for money.

Are insurance umbrellas worth it?

If the value of your possessions exceeds the limitations of your auto or home liability insurance, umbrella insurance is a good investment. Umbrella policies are generally inexpensive, so they are worth considering if you have valuable assets that you want to safeguard from costly liability claims.

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