Does Umbrella Insurance Cover Lawsuits?
The best way to answer this question is to look at the specific policy language. The umbrella policy should provide coverage for claims against the insured that arise out of an occurrence.
The umbrella policy will not cover acts of war, nuclear hazards, bodily injury, or property damage caused by alcohol or drugs, and it won’t cover any claim arising from a crime. For inquiries, reach out to Quote Savant in Frisco TX.
Umbrella Insurance: What You Need To Know
While most types of umbrella insurance will cover your home and auto insurance if you suffer a loss, it may not cover your medical expenses or lost wages if you lose your job because of the accident. There may be some type of umbrella policy that will cover your job if you are out of work due to an accident.
As with any insurance policy, you should be sure that your umbrella insurance covers the types of things that you want to be protected before you purchase it. For example, if you purchase home insurance that only covers the value of your home, then it will not cover any house damage such as chipped paint or a broken window.
Enduring only as long as the primary policy term, umbrella coverage tends to be pricey, costing an average of 50% more than the cost of purchasing a primary policy. Additionally, to be considered ‘unconditional’, your umbrella policy must pay out regardless of the circumstances or fault of the incident that caused the claim.
On the other hand, if you purchase a home insurance policy that also covers items such as landscaping or antiques, then you will be covered if anything happens to your home that is not inside of its listed coverage.
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If there is coverage for lawsuit claims arising out of an occurrence, then there should be coverage for lawsuits against the insured arising from those occurrences. Although it may seem like a no-brainer to purchase umbrella insurance, it’s actually a common mistake for many to overlook.
Most types of insurance cover the cost of a claim if they end up having to pay out. However, not all types of insurance cover the risk of being sued. For expert advice in the greater Frisco, TX community, give us a call at Quote Savant.