Umbrella insurance protects consumers from financial
devastation. It's a common policy homeowners purchase because it protects
their home and other assets when an insurance claim exceeds existing homeowners
or auto insurance policy limits. However, it could be a smart investment for
renters, too.
It Supplements Existing Liability Protection
Typically, basic liability protection only includes $100,000
in coverage. An umbrella policy can offer $1 million or more in additional
coverage. Both types of coverage offer financial protection and peace of mind.
It's Inexpensive
For $1 million in liability protection, renters could pay as
little as $300 a year. Claude Lilly, Clemson University College of Business and
Behavioral Science dean, also reminds renters that an addition million may only
cost $100 more. This inexpensive investment protects a renter's possessions,
auto and other assets as it gives the insured peace of mind.
It Complements Exposures
The hobbies a renter enjoys can make an umbrella policy a
necessity. For instance, the renter's dog bites a contractor or guest,
resulting in thousands of dollars in medical expenses and an expensive lawsuit.
The umbrella coverage kicks in after the basic renter's insurance policy funds
are exhausted, and it provides the financial protection the renter needs.
Likewise, owning a swimming pool, hunting as a hobby or
playing golf can each be fun activities, but they also have the potential to
turn into expensive lawsuits. Renters should invest in an umbrella policy that
covers expenses associated with a claim or liability related to the exposures
they enjoy.
Consider Net Worth
Each renter can decide how much umbrella insurance to
purchase. Overall, the renter's current assets and net worth determine the
basic coverage amount.
Buy Based on Future Earnings
A renter who's found liable for an auto accident could face
wage garnishment. Purchasing an umbrella policy that takes future earnings into
account ensures the renter is adequately covered and can pay the judgment
without losing his or her home and other assets.
Remember Slander, Libel and Invasion of Privacy Protection
Umbrella coverage does more than protect financial assets
after an accident or lawsuit. It also protects renters who are victims of
slander, libel or privacy invasion. The protection an umbrella policy offers
against these challenges makes it a wise investment.
Overall,
umbrella insurance provides beneficial coverage for every consumer, including
renters. An insurance agent can offer additional counsel and advice regarding
how much umbrella insurance to purchase.