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How True Umbrella Insurance Can Protect High Net Worth Individuals From Unexpected Liability
There are around 62.5 million high-net-worth individuals globally, which continues to increase. With higher net-worth growth, however, comes more risks, with one being asset protection. So, what needs to be in place to protect individuals and families?
High-net-worth individuals are more vulnerable to lawsuits than ever. After all, over 100 million court cases are filed annually, and liability protection is required to protect their assets and reputation.
True umbrella insurance is one solution to help protect high-net-worth individuals. Read on to learn how a true umbrella insurance policy can protect you from unexpected liability.
Why Are High Net Worth Individuals at Risk?
Many wealthy individuals are targets of lawsuits, whether they are public figures or not. After all, high net worth can bring good and bad attention. There can be more risks due to various reasons, including businesses and valuable assets.
Whether you are looking at protecting your own assets or you manage assets for an individual, the right high net worth insurance coverage is essential for liability protection. It is vital to consider umbrella insurance policies, which can provide extra cover for costly lawsuits, providing an easier way to settle and protect the individual’s reputation.
What Is True Umbrella Insurance?
A typical umbrella policy is useful for extending coverage limits to address some extraneous circumstances. But even though umbrella policies are a useful addition to standard policies, they can still fail to address key areas where you need coverage. Adding a True Umbrella policy to your existing coverage can help you address possible gaps and exclusions. With True Umbrella, you have the flexibility to schedule coverage for specific risks that may not be covered by other policies.
In other words, a true umbrella insurance policy enhances your liability insurance. It provides extra coverage and other benefits that other policies do not provide. True umbrella insurance provides extra liability coverage for work, home, and play.
Excess Liability Insurance vs. Umbrella Insurance Coverage
There are some similarities between excess liability and umbrella insurance policies; however, they are not identical. Excess liability insurance provides extra limits to your current policies, whereas umbrella insurance also expands coverage.
The advantage of umbrella insurance is that it provides coverage that your original policies may not offer. So, it will pay out whether you are at fault, accused of libel or slander, for example.
How Does True Umbrella Insurance Work?
A true umbrella insurance policy protects high-net-worth individuals’ assets, reputation, and livelihood in different ways. It expands auto, boat, homeowner, and other insurance policies, so they cannot be exhausted in the event of a lawsuit. It also provides coverage for claims that other insurance companies may not include.
So, if a lawsuit arises, you will look at your liability coverage. There may be a remaining amount that would have to come out of pocket without extra coverage. However, with true umbrella insurance, you may be covered.
True umbrella insurance may pay the difference between the insurance policy and what is left to pay. It can also help cover legal costs for the lawsuit process.
What Do Umbrella Insurance Policies Cover?
Umbrella insurance policies can be for personal or commercial use. They usually provide liability protection for third party injuries and property damage, personal liability claims, lawsuits, and more. For example:
- A severe boat or car accident
- Your dog bites someone
- You drive into a building
- You accidentally injure someone
- Your teenager is sued or accidentally damages property
So, when the costs are higher than your auto or homeowner liability limits, you will still have liability protection with umbrella insurance policies.
They can cover landlord risks such as liability coverage for rental units and other liability issues. They also cover risks more likely to arise with high-net-worth individuals, such as defamation or false imprisonment.
Umbrella insurance policies also cover legal fees. However, the precise coverage will depend on the policy you obtain. There is no promise of coverage due to the differences in policies and legal situations.
Do You Need a True Umbrella Insurance Policy?
True umbrella insurance is essential for asset protection. Having the proper asset protection in place is vital if you are a wealthy individual. Umbrella insurance is one of the protections that can help you.
You may want to consider true umbrella insurance for the following situations:
- You own dogs or other large animals
- You have a public profile
- You are in charge of a family trust
- You sit on a charitable boat
- You own a swimming pool or pond
- You host parties at your home
These circumstances can also increase your liability risks and the chance of unexpected liability. For example, nearly 4.5 million people are bitten by dogs every year. If you are unsure if you need an umbrella policy, it is best to consult with a professional insurance broker to learn more about your coverage options.
Protect Yourself From Unexpected Liability
True umbrella insurance can help protect you in the event of unexpected liability. Unexpected liability is possible for everyone, but high-net-worth individuals are at greater risk. If you suspect umbrella insurance is for you, or you want to know more about asset protection, it is time to consult with an insurance partner.
XINSURANCE helps provide insurance solutions for high-net-worth individuals and families. We specialize in providing coverage solutions that traditional insurance companies won’t or can’t provide. You or your insurance agent can contact us to learn more about our unique true umbrella insurance solution and receive a quote.