An umbrella policy provides excess coverage above and beyond what is provided by your homeowners and auto insurance policies. An umbrella policy is a form of personal insurance, so it won't protect you from lawsuits related to a business you own. An umbrella policy picks up where your auto and homeowners insurance policies leave off. It has a high deductible because the deductible is designed to be met by your other policies.

Expect to pay a few hundred dollars a year for this coverage. It provides an additional layer of security to those who are at risk of being sued for damages to other people's property or injuries caused to others in an accident.

An umbrella policy also protects against libel, vandalism, slander and invasion of privacy. An umbrella insurance policy is very helpful when the insurance owner is sued and the dollar limit of the original policy has been exhausted. The added coverage provided by liability insurance is most useful to individuals who own a lot of assets or very expensive assets and are at significant risk for being sued.

An umbrella policy protects your current and future personal assets (like wages, inheritance, future lottery winnings!) against the cost of losing a lawsuit over a car accident or an accident on your property. For more information and to see if you need this coverage click here.