Umbrella Insurance in California

Experts break down personal umbrella insurance costs, coverages, companies, and more in California.

Written by Meg Stefanac
Written by Meg Stefanac

Financial blogger and business owner, Meg Stefanac, has more than 15 years experience working in the financial services industry and enjoys helping individuals make solid financial decisions. Meg has extensive experience writing about insurance and finances and is a key contributor to

Suburban house in sunny summer afternoon. Find California umbrella insurance.

You probably have a lot of personal liability coverage through some of the policies you already carry, such as your vehicle or home coverage. But is it enough?

Many insurance companies top off their liability coverage at about $500,000, however judgments in wrongful death and injury liability cases in California sometimes top $2 million. Don’t let an accident or momentary lapse in judgment bankrupt you. Protect yourself with umbrella insurance.

Local independent agents can help you obtain and review customized quotes from some of the best umbrella insurance companies in California. That way, you can be sure you are getting the extra liability coverage you want at a price you can afford. Find an independent insurance agent near you to get started.

What Is Personal Umbrella Insurance?

Personal umbrella insurance is a secondary insurance policy that can significantly boost the maximum liability coverage limits of your other insurance products such as car, home, and boat insurance. 

Umbrella insurance usually starts at $1 million in liability coverage, which can be increased in $1 million increments. This means that if you are sued, you will be able to protect your property, savings, and other assets with an extremely high amount of liability coverage.

Be aware that personal umbrella insurance is designed to cover personal liabilities only. If you also own a business and want extra liability coverage for it, you will need a separate business umbrella insurance policy.

How Much Does Personal Liability Umbrella Insurance Cost in California?

When you think about buying millions of dollars worth of liability protection, you probably expect it to come with a hefty price tag. However, personal umbrella insurance is surprisingly affordable.

According to the Insurance Information Institute, most people can purchase $1 million worth of extra liability coverage for as little as $150 to $300 a year. The next million will run about $75 a year while each additional million averages about $50 a year.

That means that if you have a lot to lose and want to have $10 million worth of extra liability protection, you can get it for around $700 a year, which is only about $60 a month. That is a very small price to pay for the peace of mind a good policy can give you.

What Does Personal Umbrella Insurance Cover?

Personal umbrella insurance is designed to cover your financial obligations if you are sued and the liability limits of your primary insurance policy are too low to fully protect you.

You can use your personal umbrella insurance policy to boost the liability limits of the following coverages.

If you are at fault for someone else’s injuries, property damage, or financial losses, and your financial obligations to them exceed what your primary insurance can cover, your umbrella insurance will kick in and cover the overages up to its own coverage limits.

How Can Personal Umbrella Insurance Help Vehicle Owners in California?

In California, drivers are required to carry a minimum of $30,000 per accident in bodily injury liability coverage. Given the high cost of healthcare, this is not likely to be sufficient to meet your financial obligations if you cause an accident that involves significant injuries.

That is why many drivers in this state choose to purchase coverage in much higher amounts than the state requires, but car insurance providers typically max out their offered liability coverage at $500,000.

If you are responsible for an accident that causes someone else to experience serious injuries that require long-term care or, in the worst case, death, half a million dollars isn’t likely to be enough to cover your obligations.

This is because, in addition to the cost of medical treatment, you will be responsible for years of lost potential earnings. According to the CDC, the average cost of a collision-related death in California is around $1.46 million.  

If your assessed costs exceed what your policy can cover, you are responsible for the overages. An umbrella insurance policy can help you maintain your assets and financial standing by covering them for you.

For your car insurance policy to be covered by umbrella insurance, you will typically be required to carry the maximum liability coverage offered by your primary policy.


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How Can Personal Umbrella Insurance Help Homeowners and Renters in California?

Whether you own or rent your home, you probably already have a lot of liability protection through your primary homeowners, renters, condo, or other insurance policy. These policies can usually give you up to $500,000 in personal liability coverage, which is often more than enough.

However, there are times when liability lawsuits become extremely expensive. This is most likely to happen if someone is significantly or fatally injured and your actions or negligence are to blame.

For instance, as a homeowner, you can be looking at a very expensive lawsuit if a visitor drowns in your swimming pool. Or, you could face large expenses if you accidentally strike someone in the head with your club while golfing and they suffer brain damage.

For your home insurance policy to be covered by umbrella insurance, you will typically be required to carry at least $300,000 worth of liability coverage in your primary policy.

How Else Can Personal Umbrella Insurance Help California Residents?

If you have any other policies like boat insurance, ATV insurance, or landlord insurance, your personal umbrella insurance can help you be certain that you will have sufficient liability coverage if the unthinkable happens.

For instance, in California, there are an average of 375 boating accidents a year. These accidents result in an average of 39 deaths a year. In the unfortunate event that you cause a serious boating accident, you may be glad that you have umbrella insurance.

In order for boat insurance and any other kinds of insurance to be covered by umbrella insurance, you may need to max out the liability coverage in your primary policies. Be sure to find out what is required when you are purchasing your umbrella coverage.

What Is Not Covered by California Umbrella Insurance?

As with any insurance policy, umbrella insurance has some limitations. You should not expect your policy to cover the following situations.

  • Injuries, property damage, or financial losses that you caused intentionally and/or while committing a crime
  • Injuries, property damage, or financial losses sustained by you or members of your household
  • Liabilities related to professional liability lawsuits or malpractice suits

Be sure that you understand all of your umbrella insurance policy’s coverage exclusions so that you do not find yourself facing any troubling surprises later on.

How Much Personal Umbrella Insurance Do I Need?

The more you have to lose, the more liability coverage you will want to have. When deciding how much coverage to buy, you may want to consult a financial advisor, or you can discuss your concerns with a knowledgeable independent agent.

As a general rule of thumb, financial experts recommend that your umbrella coverage limits meet or slightly exceed your estimated net worth. This means that if your net worth is calculated at $4.7 million, you may want to purchase a $5 million umbrella insurance policy.

Personal Excess Liability Insurance vs. Umbrella Insurance

Insurance companies will sometimes refer to excess liability insurance. While all umbrella insurance are excess liability policies, not all excess liability policies are umbrella insurance.

It is important that you are aware of whether you are purchasing an excess liability insurance policy or an umbrella insurance policy. While these two types of policies work in the same way, there is one key difference.

Excess liability insurance is designed to only boost the liability coverage of one specific primary policy, whereas an umbrella insurance policy can boost the liability coverage of all your personally held policies.

How Can Independent Agents in California Help You Find the Best Umbrella Insurance Policy?

When you are considering buying a personal umbrella insurance policy, a local independent agent can be extremely helpful.

These agents are free to work with some of the best umbrella insurance companies in California, so in addition to answering your coverage-related questions, they can provide you with a variety of customized quotes. That way, you can be certain you are getting your coverage at a competitive price.

Also, because independent agents have a wide range of knowledge and experience, they can also help you with any other insurance concerns you may have. Arrange an obligation-free consultation with an independent insurance agent near you to learn more.

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