Imagine a group of children playing on the swing set in your backyard. One of the kids falls off and is seriously hurt. Her parents sue you, claiming the swing set is defective, and they are seeking $1 million in damages. An accident like this can happen in the blink of an eye, and it can happen to anyone.
As you read this, are you saying there is no way your friends would sue you like that? Well, they might not have a choice. If the medical bills are significant, your friends might not be able to afford them. They look to you, since it was your swing set, and you can't afford to pay the medical bills either. So, they feel like they have no choice but to sue since the hospital wants the money.
How can you protect yourself and your assets from this possibility? Purchase umbrella insurance from your insurance provider. Umbrella insurance is extra liability insurance. This is how it works:
- If you are sued for that swing set accident, then your homeowners liability policy will take effect. Once you reach the limit on that policy, then the umbrella policy takes effect. It is recommended you have a minimum of $1 million coverage with an umbrella policy.
- If the accident was at a house you rent to others, then your homeowners policy will not cover the accident. However, the umbrella policy will often kick in.
Are you thinking, “I can't afford it. I'll just rely on my homeowners policy?” Before you make that decision, ask an independent agent. You might be surprised to find that adding that $1 million dollar umbrella policy is not that much more money. At the very least, it’s worth the few minutes it takes to get a quote.
Want extra protection? Call LIA - Lalani Insurance Agency at 832-810-0210 for more information on umbrella insurance.