Alaska is a beautiful state with a diverse population and a wide range of activities to enjoy. From hunting to fishing, and sled races to sports, Alaska's cold temperatures don't keep people indoors. But even on the warmest AK days, accidents still happen, which is why it's important to have insurance. Umbrella insurance, in particular, may be one way to help you save money and frustration when it comes to insurance coverage. While many people don't know what umbrella insurance is, it's a viable and affordable option for extra liability insurance needs.
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- The plaintiff wins an average of 55% of all tort trials.
- While AK has a small population, it has a high number of lawyers, comparable to the number in Washington, Vermont, or Florida.
- In jury trials, the average award was $201,000
No matter how careful you are, lawsuits and accidents can happen. Many insurance policies don't come with enough liability protection, which is why an umbrella insurance policy can come in handy for some extra insurance.
What Is Umbrella Insurance?
Many insurance policies you already own come with some liability coverage built-in. For example, your auto insurance may come with a $250,000 liability limit. Unfortunately, if you're involved in an accident and the liability exceeds this amount, you are expected to pay for this out of your own pocket. In the case of a serious or fatal accident, your liability limit can be reached within hours. An umbrella insurance policy is designed to raise the liability limit on all your policies, and kick in to protect you when other policies reach their limits or have exclusions.
How Does an Umbrella Insurance Policy Work?
Let's say, for example, that you're driving down the freeway after work and you're involved in an accident that causes serious harm to three other individuals. You are all transported to the hospital and treated. After everyone is checked out of the hospital, the bills start piling in. You have a $250,000 cap on your liability insurance, but the bills total $800,000. Unfortunately, the insurance company says that you are responsible for the remaining $550,000. If you have a $1 million umbrella insurance policy in place, your umbrella insurance policy will kick in, covering the rest of the $550,000.
An umbrella policy, in essence, extends your liability coverage on the majority of your insurance policies. Additionally, it covers events that other insurance policies may not cover, such as:
- False arrest
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How Much Is a Quote for an Umbrella Insurance Policy?
When it comes to the price of an umbrella insurance policy, there's no strict number, as a variety of factors go into deciding your individual needs. As an average, however, the ACE report provides these typical annual costs:
- $383 for $1 million in coverage for a household with one home, two cars, and two drivers.
- $474 for $2 million in coverage for the same household.
- $608 for $5 million in coverage for the same household.
- $999 for $10 million in coverage for the same household.
- $1,578 for $10 million in coverage if the household also has 2 more homes, 2 more cars, a boat under 26 feet and a driver who is under 25.
When you decide to start getting umbrella insurance quotes, be ready to answer the following questions:
- Your net worth
- Claims history
- Credit report
- Driving record
- Risk profile
- Preferred coverage amount
One important factor to consider is your net worth. High net worth individuals are more at risk for large lawsuits. However, many of these individuals do not have sufficient liability coverage. Additionally, if you have a high-risk lifestyle, you may also be more susceptible to lawsuits, so it's important to consider these factors when deciding how much coverage to purchase.
Getting the Right Umbrella Policy for You in Alaska
When searching for an umbrella insurance policy to keep you and your loved ones safe from liability claims, it's important to have a professional by your side who understands your risks and way of life. A TrustedChoice.com independent agent is always available to help you find coverage, answer questions or even help you file a claim.
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