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Why do I need Personal Umbrella Coverage?

Here's your nightmare: Your car skids. You crash into a Mercedes with a highly paid business executive at the wheel. He's hurt so badly he cannot return to work. A jury awards him millions of dollars, and you have to pay it.

You're wiped out financially. The court takes your savings, goes after your home and, for decades, requires you to give up part of your salary.

For some people such a nightmare could never happen. They have an extra insurance policy, know as umbrella liability coverage, which takes care of their liability for the lawsuits and medical bills of the auto accident victim - or other injured person. The cost of an umbrella policy is usually a fraction of the price of a typical package of home and auto insurance.

  • Are you the local "chauffeur"? If you drive a lot of the local kids around to ball practice, scout meetings, church events, etc, you could have a tremendous liability exposure if you should be involved in an accident.

  • Do neighborhood children ever play in your yard? Do you own a swing set? A trampoline? Do you own a dog? Neighborhood children could suffer injuries including disfigurement and permanent paralysis.

  • Do you hunt, fish or play golf. Could your actions ever accidently hurt others?

Other Examples of Protection Offered by Umbrella Policies


  • A driver sees a ball bounce out into the street. It's followed by the young child who lost it. The driver can't stop in time and the child is severely injured. In court, damages are awarded to the child's parents for $1 million. The driver's Auto policy pays its limit of $500,000 per claim: the driver is responsible for the remaining $500,000.

  • During an ice storm, a driver loses control of her car and slams into a school bus. No one is severely hurt, but he 35 children are all traumatized. In court, damages are awarded in the amount of $20,000 per child for a total of $700,000. The driver's Auto policy pays its limit of $500,000 per accident; the driver is responsible for the remaining $200,000.

  • A guest injures himself during a dive in a backyard pool. In court, damages are awarded in the amount of $1.5 million. Homeowners insurance pays the limit of $500,000; the homeowner is responsible for the remaining $1,000,000.

Important Wisconsin Law changes affecting Personal Umbrella coverage and Auto Liability coverage effective November 1, 2009


Effective November 1, 2009, Personal Umbrella coverage will automatically include Uninsured Motorist and Underinsured Motorist Coverage unless one or both are rejected in writing by the policyholder. This coverage must also be offered if Personal Umbrella coverage is desired.

Also, as of this same date, the Personal Umbrella Uninsured Motorist or Underinsured Motorist coverage limits can be increased (stacked) in the event of a covered loss. The increased (stacked) limit is based on the number of vehicles carrying the Personal Umbrella Uninsured Motorist or Underinsured Motorist coverage and is limited to a maximum of three. This change cannot be rejected if Personal Umbrella Uninsured Motorist and/or Underinsured Motorist coverage applies under your Personal Umbrella coverage.

For more information or to talk about your needs for an umbrella insurance policy, contact your Coverra agent for more details.