All You Wanted to Know About Umbrella Liability Auto Insurance ...

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By admin | August 29, 2012

The main aim of an Umbrella Liability Auto Insurance is to provide peace of mind to all those who want some additional coverage besides the basic auto coverage that they possess. It is basically designed to cover the policy owner in case the owner is sued by the court and is held responsible for a serious accident. This policy is also referred to as excess coverage or ULI and it helps to pay off the claim amount in case the policy holder is found to be legally involved in some accident.

How Does An Umbrella Liability Policy Work?

Read on to understand how a ULI works and how it can protect you from paying huge damages.

Suppose you own auto insurance coverage with a liability limit of $200,000 per accident and you also possess a ULI with a liability limit of $2 million. Now you are found to be responsible for an auto accident and the court slaps a $300,000 fine on you. In such a case while your auto insurance would shell out $200,000, the rest would be paid by the ULI policy that you own.

What Coverage Is Provided By A Typical ULI?

An Umbrella Liability Insurance policy provides the policy owner with the below mentioned protection:

o Protection for all claims of body injuries or property damages that may be caused due to the policy holder or anyone in the family.
o Personal liability coverage for accidents that happens on or off your property.
o Protection against all claims of defamation, insult, false arrest or illegal eviction.
o The ULI also covers all legal defense costs that include the fee of the lawyers and other associated costs.

The Following Are Not Covered By A ULI

Though Umbrella liability coverage has a huge coverage still there are a few aspects that are not covered by the policy. These are:

o All intentional damages caused to your car or your property.
o Damages due to personal or business pursuits.
o All liability related to recreational vehicles like, aircrafts, airboats or water skis.
o All liability arising due to war or civil disobedience.
o All damages covered under a worker?s compensation policy.

Many of you may still feel that a basic insurance coverage is all that you need, but do keep in mind that a serious auto accident can wipe out all your assets and leave you with nothing. This is the sole reason why you would be suggested a ULI by your agent in most cases. A typical policy can provide you with coverage worth $1 million to $10 million. However, you must see how much premium you can afford and then only go ahead with determining your coverage limit. At the end of it all, you actually have nothing to lose!

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