The purpose of the personal umbrella liability policy is that it’s a catch-all insurance policy if your first line of defense, such as the homeowners or automobile insurance policies, get breached (ie. your sued for a lot of money). It’s essentially an extra layer of protection between the lawyers and your assets.
Let’s say you get into an accident, sued, and found liable for half a million dollars. Your auto insurance will pay out the first $XXX,XXX (let's say $300,000), your then responsible for the remaining $200,000. If you had a $1M personal umbrella insurance policy, the $200,000 would be covered.
The average price for a $1M personal umbrella liability policy is anywhere between $150-$300 per year with the next million costing around $75. To be eligible, especially at those prices, the insurer will want you to have auto and homeowner’s/renter’s insurance that will cover you to a minimum amount because they are the second layer of defense.
This is just one example, each situation will differ. Contact us to discuss if a personal umbrella liability policy is right for you.