In most cases, your Maine auto insurance and home insurance will provide the coverage you need if you’re responsible for minor injuries or property damage. But what if you’re hit with that once-in-a-lifetime million-dollar lawsuit? Do your auto and home insurance provide enough coverage?
Umbrella insurance can help you bridge the gap between your basic personal insurance policies and a million-dollar (or more) judgment against you. An independent insurance agent in Maine can help you find umbrella insurance that fits your needs and budget.
What Is Umbrella Insurance?
Before you understand what umbrella insurance is, it’s important to understand what liability insurance is. If you have auto insurance, homeowners insurance, renters insurance, or condominium insurance in Maine, you also have liability insurance as an essential part of those policies.
Liability insurance protects you when you or a covered family member cause some type of property damage or physical injury to another person. Your auto liability insurance covers you if you cause a car accident that injures another driver or passenger. And your home liability insurance covers you if someone is injured at your home, or if you or a covered family member hurts someone or damages someone’s property (e.g., your child breaks the neighbor’s window with a baseball).
Liability insurance pays for repairing or replacing damaged property of others. It also pays for medical expenses for injured parties, and it even pays your attorney fees, court costs, and any financial settlements or judgments that you have to pay if you are sued. But both your auto insurance and your home insurance have coverage limits that are specified in the policy. If you’re sued, your policy limits may not be sufficient to cover a large financial settlement.
A Maine personal umbrella policy offers excess liability coverage that kicks in when the limits of an underlying policy—including homeowners insurance, renters insurance, condominium insurance, boat insurance, or auto insurance—have been exhausted.
What Does Umbrella Insurance Cover in Maine?
Umbrella insurance in Maine typically offers “follow form coverage.” This means that the umbrella policy covers what the underlying auto or home policy does. Maine umbrella insurance typically covers the following types of claims for any person that is covered under the primary insurance:
- Personal injury
- Advertising injury
- Property damage liability
- Defamation of character
- False arrest, detention, or imprisonment
- Malicious prosecution
- Mental anguish
Your umbrella insurance may offer coverage for certain losses that are not covered by the underlying policies, including covering you worldwide. So if you cause a car accident while driving abroad, your Maine auto insurance policy might not cover you, but your umbrella policy would.
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Who Needs Umbrella Insurance in Maine?
Does everyone in Maine need umbrella insurance? Umbrella insurance is not required for anyone, but if you’ve got assets to protect, it’s certainly worth looking into. And it’s true that certain lifestyle factors or activities that you pursue can increase the likelihood of you being the target of a lawsuit. You might be more likely to be sued if you:
- Own a home
- Own a rental property
- Have a trampoline, pool, or hot tub
- Host large parties
- Have a teenage driver
- Own a dog
- Own a large home
Anyone with significant assets or an obvious “attractive nuisance” (e.g., a hot tub or a trampoline) should talk to their independent insurance agent about the need for an umbrella policy.
How Much Umbrella Insurance Do I Need in Maine?
Umbrella insurance policies in Maine kick in only when the limits of the applicable underlying policies have been exhausted. They are typically sold in million-dollar increments, such as $1 million, $2 million, or $5 million.
You need to have a certain level of underlying Maine home and auto insurance in order to purchase an umbrella policy. If you don’t have auto and home insurance, you won’t be able to buy umbrella coverage. Your independent insurance agent will help you decide how much additional liability coverage you need to appropriately protect your assets should you be sued.
Most umbrella policies in Maine require you to have at least $250,000 per person/$500,000 per accident (or a $300,000 combined single limit) bodily injury liability coverage on your auto insurance policy in order to qualify for an umbrella policy. You’ll need to have homeowners insurance with a minimum amount of personal liability insurance, as well.
Some umbrella insurance providers require you to have your auto and homeowners insurance with them before they will issue you an umbrella policy.
Can You Deduct Umbrella Insurance on Your Taxes in Maine?
Personal umbrella insurance premiums are not usually deductible from your taxes. You may, however, be able to deduct a portion of your premiums as a business expense if you own rental properties that are covered along with other personal assets under one personal umbrella policy.
If you own a business and have a business umbrella policy that supplements your other business liability policies, your premiums may be tax deductible.
Who Are the Best Umbrella Insurance Companies in Maine?
It can be simple to find the best umbrella insurance companies in Maine. A local independent insurance agent can help you get umbrella insurance quotes from multiple insurance companies, so you can select the best policy for your needs and budget.
Why Shop Umbrella Insurance with a Maine Independent Insurance Agent?
Instead of getting an online quote, find an independent insurance agent now, and get one-on-one consultation and affordable options for the best coverage for your unique needs. Your agent will work with you free of charge, offering you a variety of options so you can make the best choice.
What’s more, your agent will be there for you when claim time comes. They know the ins and outs of the process and will make sure your claim is handled appropriately.
Contact an agent today for a free, no-obligation consultation.
TrustedChoice.com Article | Reviewed by Jeffrey Green
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