What does an Umbrella Policy offer to the insured?

An Umbrella Policy is designed to provide additional liability coverage beyond the limits of existing policies, such as auto or homeowners insurance. It serves as a financial safety net for the insured by covering claims that exceed the limits of those other policies. This type of insurance is particularly valuable in situations where liability could be substantial, such as a major accident or a significant legal claim, allowing the insured to avoid out-of-pocket expenses that may arise from larger judgments or settlements.

While some may mistakenly think that an Umbrella Policy offers double coverage or only applies to specific types of damage like property, its primary function is to extend beyond the protections already in place, rather than duplicating them or limiting coverage to one category. Therefore, this comprehensive approach ensures that the insured is better protected against larger liabilities.