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Blanket Umbrella, cheap high limit coverage

A personal liability umbrella insurance policy gives you blanket protection over everything you own. But it does not replace your underlying insurance coverage, which you must max out first. A few carriers do offer stand alone blanket umbrella policies. The added liability protection cost only $200-400 per year for the 1st million, and another $50 to $100 for each million over that.

Additional liability insurance is inexpensive, especially compared to the limits. The blanket liability insurance may cover your non-business activities worldwide. Having the added protection of a liability umbrella policy is coverage no one (who can afford it) should go without. But it's usually reserved for the 1%.

Can you be denied an umbrella insurance policy?

Of course. It's the insurers money they are risking. Getting umbrella insurance can be difficult. Read details about umbrella insurance. Since the insurers is giving you high limit coverage for very little money, they are going to want to really examine you. Companies want to know about losses and claims in the past 5 years. If you have a pattern or recent history of insurance claims, you could be denied an blanket umbrella policy.

Insurers underwrite you as a risk.

Insurers have an acceptable risk profile. They won't just give anyone a 2 million blanket umbrella policy. Insurers want to know about:

• Any traffic tickets and accident info for the last 5 years of all drivers in your household. Not all the people in your household may be truthful about their driving records. Our oldest son tried to hide a speeding ticket until it his mail was opened, and we made them explain;
• If you volunteer on a non-profit board or participate in community service;
• All your businesses in case you are in a high-risk (to them) occupation;
• If you have a pilot's license, own, lease, or charter an aircraft, you may not be underwritten by insurance or his company. Every day, small privately owned planes fall out of the sky;
• About all your assets, in case you injure someone operating one of those assets;
• Do any of your current insurance policies have reduced liability limits or exclude coverage for specific events? That signals a loss to the insurer that they may not know about now;
• If you've have you been denied insurance coverage or been canceled or not renewed the last 5 years
• If Are you engaged in farming? Farmers get hurt more than fire fighters. It's true;
• If any drivers in your household are under 25, that's a huge red flag to insurers. Not only will your rates go up, but young drivers leading cause of death is car accidents. The major source of teen car accidents is speed. More injuries and greater property damage; and
• If you have employees that work out your home, that's a red flag to insurers. Many disability insurers will not cover someone that works in the home. Their loss rates are just too high. And umbrella policies may not cover injuries involving unlicensed workers, like gardeners, maids, contractors, etc.

Got misstatements?

Some want to lie a little to the insurance carrier to get covered. That is okay, if there are no claims. But if you make misstatements and there is an accident concerning that area of coverage, the insurer can fight paying. Besides insurance fraud is a crime, pretty serious.

Other details about Blanket Umbrella

Most companies require you to have full coverage of their auto and home, so you'll probably have to max out the their limits 1st.

Also carriers don't offer the same limits. Umbrella insurance usually extends everywhere from $1-$5 million, which is a huge difference. The price depends on the carriers historical loss rates. If you have a history of claims in the past, the carrier may charge you much more for umbrella coverage or deny you a policy all together. It's their choice.

Read the fine print

When shopping, decide how much you need, and enter the same amount with all the carriers. Also read the policy details, because there is plenty like an umbrella insurance doesn't cover. Especially business activity.

To review:

• Blanket umbrella is a great deal if you can get it
• The insurer is going to look closely at you
• You can be denied if you don't fit their model
• Don't like to insurers. They are not your mom!
• Can be hard to compare, so decide how much you want up front.
• Check policy details. They vary.

Written by Craig J. Casey

Financial Writer helping people with their insurance problems on the net since 1998.

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