Insuring Your Business

If you have several assets that you want to protect from lawsuits, such as property or annuities, you may decide that you need to purchase personal umbrella insurance as an addition to your normal liability policy. However, you may be uncertain about how much you need. If so, ask yourself the following questions when deciding how much umbrella insurance you should purchase.

What Is the Total Value of Your Assets?

One of the first things you should examine when deciding on the amount of umbrella insurance you need is the total value of your assets. Since the insurance is meant to go above and beyond your property or automotive insurance policy's claim limits to protect your assets, you need to know specific numbers on what needs coverage.

When asking yourself this question, write down the approximate value of your house, vehicles, bank accounts and stocks. After tallying up their combined value, subtract the amount of your current policy's claim limit. The difference will give you a rough estimate of how much umbrella insurance you may require.

What Future Income or Assets Do You Need to Protect?

Along with your current assets and income, think ahead to ascertain whether you may have an increase in income in the future or whether you or not you may acquire more properties, vehicles, or annuities. Even though you may not have these assets yet, they could be in danger if a lawsuit is brought against you in the present.

Although you can change your insurance policies during the enrollment periods, it is still important to think about future assets along with current ones. If someone were to file a lawsuit against you tomorrow and you were to lose in court, your immediate assets can be kept safe by the insurance.

However, if the person suing you has been awarded settlement payments for five, ten, or even twenty years, those payments may start coming out of your future holdings if your current coverage is not enough. Ensuring you plan your coverage around any possible assets in the future can help keep this from happening.

After asking yourself the above questions, you may still be unsure about the amount of umbrella coverage you should purchase. If so, speak with the insurance agent through which you plan to buy your umbrella insurance policy so they can look over your specific accounts and assets and give you a recommendation based on your particular situation. Contact an insurance agency like All Risk Insurance Group for more information.