It's a common sight along Utah's highways and on late-night infomercials: A smiling attorney promises you millions of dollars in awards for your injury, illness, or property damage, if only you use his or her services. But what happens when you are on the other side of the courtroom? In today's litigious society, lawsuits are becoming more and more frequent. Only an umbrella insurance policy can help protect your assets and future earning potential from being subject to high-dollar settlements or awards. Before you search for umbrella insurance quotes, however, there are several factors to consider.
Utah Lawsuit Statistics
According to the UT Office of the Attorney General:
- There are 300 lawsuits pending in the state's litigation division at any given time.
- Of the 172 cases closed during the past 12 months, awards upwards of $150 million were sought.
- The average payout for injury lawsuits is $60,000.
- The average award in a punitive civil lawsuit is $50,000.
- More than 80 percent of those who bring forth a tort lawsuit are successful in winning monetary damages.
What Is Umbrella Insurance?
Umbrella insurance is a form of extra liability insurance that will supplement your basic liability policies, such as your auto, home or business insurance. An umbrella liability policy covers a much higher limit and goes above and beyond claims directly relating to your home, vehicle, or UT business. The main purpose of your umbrella policy is to protect your assets from an unforeseen event, such as an accident in which you are held responsible for damages or bodily injuries. If another party files a lawsuit against you, your umbrella coverage can pay for the damages you're legally responsible for up to the policy limit. It can even assist you in paying your legal fees and court expenses.
Who Should Carry Umbrella Insurance?
While you might think that only the wealthy would benefit from an umbrella insurance policy, it's important to remember that nearly 80 percent of umbrella insurance claims in Utah stem from auto accidents. Even middle-class folks can be the subject of a high-dollar lawsuit involving injury or death following a car crash. Those who face higher risks of litigation, such as business owners, landlords, and certain professionals including physicians, therapists, or those in other consulting fields may also want to consider the extra liability coverage provided by an umbrella insurance policy.
What Does Umbrella Insurance Cover?
Umbrella insurance can help pay your attorney expenses and court fees should you find yourself party to a lawsuit. Another important feature of these policies is protection in a lawsuit against you for slander or defamation of character, or for decisions you might have made as a volunteer member of a nonprofit board. If you regularly blog about controversial topics or rant on social media sites, an umbrella policy just might be a good idea to protect your assets from a litigious individual who believes you've damaged their reputation.
Some people assume that if they don't have $1 million to lose, they don't need an umbrella policy. Unfortunately, if you are sued by someone who falls down the stairs at your home or whom you injure in a car accident, you can be sued for more than just what you have in the bank.
How Much Umbrella Insurance Should I Purchase?
Insurance providers generally offer umbrella policies in $1 million increments. The amount of extra insurance you require depends on several factors:
- Your risks: Consider risks as a homeowner or renter, the risk of causing an accident during your work commute, and any potentially dangerous activities you participate in that could put those around you at risk. Landlords, business owners, and those in the consulting fields face more risk than others.
- Your assets: These include properties, possessions, stocks, bonds, savings, and retirement funds. The more assets you have to protect, the higher the umbrella policy limit you should consider.
- Your future: Because liability lawsuits can result in loss of both current assets and future income, even those with few assets to protect may want to consider the long-term ramifications of a serious claim. If you are on track for a high-paying career, you may have more to protect if your future earnings are garnished as part of a settlement or judgment.
Is Umbrella Insurance Expensive?
The average quote for a $1 million umbrella policy is $200 annually, which is incredibly affordable for the peace of mind and security it offers. It's important to remember that double the protection doesn't automatically mean double the price. A $2 million umbrella insurance policy can be found for around $300 a year. To be sure the umbrella policy you choose is the best one available for your situation, it's always a good idea to shop around and compare several quotes from a variety of insurance companies.
Where Can I Find Umbrella Insurance?
Of course, it is important for those injured due to someone's negligence to be compensated for their costs and medical treatment. But it is also vital for those on the other side of the suit to be protected from damaging effects on their finances. Knowledgeable, independent insurance agents in our network are always available to answer your questions about umbrella insurance, suggest coverage limits, and even assist you in filing a claim. These agents have years of experience working with Utah insurance companies, enabling them to find you several quotes with the best coverage limits at the most affordable rates.
Contact an agent near you to find out how you can obtain an umbrella insurance policy that meets your needs and budget.