by Michael Di Corcia

Created on: March 04, 2009

A personal Umbrella policy, is a policy that just like an Umbrella floats above your property (homeowners, renters, landlord, vacation home) Auto, motorcycle, boat etc. any personal insurance that carries liability protection.

In today's economy, we are seeing an increasing number of people filing lawsuits to "supplement" their dwindling retirement funds in addition to people who have tasted the sweet nectar of tax free law suit settlements as sad as it may seem they are out there and they are always thinking if a lawsuit is possible.

An umbrella policy will not prevent a lawsuit from happening but it will give you the peace of mind that your assets are well protected. I have experienced it first hand, my wife had a small fender bender a few years ago with damages totaling less than $2,000.00 a couple of months later we received a letter from an attorney suing my wife and my 4 month old child (he was a passenger) for 3 Million dollars for pain and suffering.

Three years passed and the insurance company settled for a fraction of the suit, a very small fraction. My personal umbrella policy gave me the piece of mind that regardless of the outcome my assets were protected, and that my insurance company would take care of the attorneys fees and court appearances, as a matter of fact over the entire ordeal our insurance company told us not to worry and to let them do their work. We spoke to the attorney four times during the entire time and then we received a letter telling us that the suit was settled and that we were done.

Until then I knew I was paying for this policy but I never paid too much attention to it, my agent told me I needed it and I believed him, and the 25 dollars per month premium seemed reasonable for millions of dollars in coverage. After the suit I looked more into it actually read the policy when the renewal came in and found out all of the claims it can protect me from.

I was especially interested in the coverage against suits arising from the injury of guests in my house, as a father with a child with friends coming over I had always the fear if something were to happen to one of the kids, I still do of course I don' want anyone to get hurt, but if that were to happen I know that I am protected, this has allowed both me and my wife to relax and let the children play without being too apprehensive.

It is also important to remember that many states if not all, allow law suits awards to be attached to wages, just like child support is, some states will also allow a plaintiff to go after a retirement fund, and of course your assets as well like your home, your bank accounts, cars and anything that could be sold and tuned into cash, so the idea that many have that if they don't have a house to lose they don't have to worry about a lawsuit is wrong.

Even those who rent should carry an umbrella policy, or at the very least a renters policy, remember that if you have guests and offer them wine and then they get into an accident, the person they hit could very well sue you as well, as the person who served the beverages to your friend.

And a policy that costs as much as a cup of Starbucks Coffee a day, is a well worth investment.

I always carry with me my insurance agent's card, in the back he wrote "insurance is like a parachute, if you don't have it when you need it, it's too late.

Learn more about this author, Michael Di Corcia.
Click here to send this author comments or questions.