Umbrella Insurance in Texas
Experts break down extra liability insurance costs, coverages & companies in Texas.
Anyone can make a mistake. Sometimes a mistake, error in judgment, or negligent act can cause someone else to suffer significant monetary losses, injuries, or other harm. Umbrella insurance can protect your assets by ensuring that you have sufficient liability coverage in the worst-case scenarios.
Independent agents in Texas can explain the many benefits of having a personal umbrella insurance policy and can help you find the best and most affordable coverage to protect you and your family. Contact an independent insurance agent near you to learn more.
What Is Umbrella Insurance?
Umbrella insurance is a secondary insurance policy. It can significantly boost the personal liability coverage provided by the insurance policies you currently carry, which are your primary policies.
If you are responsible for someone else experiencing injuries, property damage, or financial losses, and your financial obligations exceed what your primary insurance policy can cover, your umbrella insurance will kick in to cover the overages up to its own coverage limits.
Most umbrella insurance policies start at $1 million worth of extra liability insurance. Coverage limit increases are typically made in $1 million increments.
Who Needs Umbrella Insurance in Texas?
Umbrella insurance is an optional form of coverage, so nobody necessarily needs to have it, but for many, it is worth considering.
Personal umbrella insurance is a good idea for any Texas resident who has a lot to lose and therefore wants to safeguard their property, savings, and other assets. It provides a high level of liability coverage at a very affordable price. This can be very beneficial.
For instance, if you are accidentally responsible for someone suffering a serious injury that required extensive medical treatments or worse, death, you can be on the hook for a lot of money. For instance, a judgment against you in a wrongful death lawsuit will typically include compensation for:
- Medical bills
- Funeral and burial costs
- Lost earning ability
- Value of services lost (This means things like the value of childcare services offered by a stay-at-home mother.)
- Loss of companionship
- Pain and suffering
- Emotional distress
If the court determines that your conduct leading up to the incident was especially bad, you may be hit with punitive damages as well. All of this can add up to millions of dollars assessed against you.
The liability coverage offered by car insurance and home insurance policies often maxes out at $300,000 to $500,000. This means that if you are found guilty in a wrongful death lawsuit and ordered to pay $1.5 million, you can be on the hook for a lot of money.
With an umbrella insurance policy, you can rest assured that the extra coverage you need will be available for you.
How Much Does Personal Liability Umbrella Insurance Cost in Texas?
The Insurance Information Institute (III) states that most people can purchase $1 million worth of extra liability coverage for as little as $150 to $300 a year. Each additional $1 million generally costs between $50 and $75.
Personal umbrella insurance coverage is so affordable because it doesn’t kick in unless your primary liability coverage has been exhausted.
What Does Personal Umbrella Insurance Cover?
Personal umbrella insurance is designed to cover your additional costs if the limits of the liability coverage in your primary insurance policies are too low to meet your financial obligations.
You can use your policy to boost the coverage limits of your:
- Vehicle liability coverage, including:
- Home liability coverage, including:
- Other, less common, personal liability coverage, including things like:
In most cases, you will be required to purchase the maximum liability protection offered by your primary insurance policies in order for your umbrella insurance to provide additional coverage.
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What Is Not Covered by Personal Umbrella Insurance in Texas?
As with any insurance policy, umbrella insurance has some exclusions on what it will cover. In most cases, umbrella insurance claims will be denied if the injuries or property damage:
- Were inflicted upon others intentionally or with malice
- Occurred while you were committing a crime
- Were sustained by you or members of your household
Additionally, umbrella insurance will not cover expenses related to business or professional liability lawsuits, even if you are self-employed. To have this coverage, you will instead need to carry a high amount of commercial liability insurance, professional liability, or malpractice insurance.
How Much Umbrella Insurance Do I Need in Texas?
The decision to buy extra liability insurance is a personal one, and only you can ultimately decide how much coverage you want to have.
It is important to remember that the more you have, the more you can lose if you end up on the wrong end of a liability lawsuit and your liability coverage limits are too low.
The first thing you will want to look at is your protected assets. In Texas, the following property cannot be seized if you have a large judgment against you:
- Your primary home and its furniture
- Cemetery plots purchased and intended for use by you or your family
- Personal property up to $50,000 per person / $100,000 per family
- Tools and other equipment needed for your work in a trade or profession
- Jewelry and family heirlooms, clothing, firearms, and athletic equipment
- One vehicle per licensed driver in your household
- Funds in a college savings plan
- Retirement plans and accounts
Most of your other assets, however, are fair game. This means that if you own any particularly valuable property or have a lot squirreled away in a savings account, you could potentially lose it all if you lose a liability lawsuit and do not have enough insurance protection.
You may therefore want to consider having enough umbrella insurance to fully cover non-exempt assets. For help determining how much umbrella insurance is sufficient for you and your family, you may want to speak with an accountant, financial advisor, or estate lawyer.
Can You Deduct Umbrella Insurance on Your Taxes in Texas?
Unfortunately, no. Only businesses are able to deduct the cost of umbrella insurance. Umbrella insurance policies purchased by individuals are considered personal expenses and are therefore not tax deductible.
What Are the Best Personal Umbrella Insurance Companies in Texas?
The best umbrella insurance companies in Texas are the ones that have a well-documented history of reliable coverage, responsive customer service, and competitive prices.
Local independent agents have established relationships with many of the most highly rated insurance companies in the area so that they can provide you with quotes from a selection of trustworthy insurers.
How Can an Independent Agent in Texas Help Me Find the Best Umbrella Insurance?
Independent insurance agents are available to explain the fine details of umbrella insurance and can gather customized quotes from a variety of Texas’ most highly rated insurance companies.
This lets you be sure that you are getting the coverage you want at a competitive price. Arrange an obligation-free consultation with an independent insurance agent near you to get started.
TrustedChoice.com Article | Reviewed by Jeffrey Green
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