Why the Need for Umbrella Insurance Increases as You Near Retirement

When you purchase insurance from Insurance & Financial Services Inc., you cover some aspect of your life in or around Baton Rouge, LA. It might cover your home, business, or automobile, but it includes liability insurance.

Your need for increased liability grows as you age. At that point, you need to add umbrella insurance to the policies you carry. Umbrella, a secondary type of insurance, offers added liability protection to a primary policy that already offers liability insurance coverage.

As you age, you build a nice nest egg for retirement. If you don’t add umbrella insurance to your primary policy, then when you retire, you put your entire savings in jeopardy.

Home insurance offers about 10 to 20 percent of the home’s value as liability coverage. If your home value equals $200,000 and your policy offers 10 percent of its coverage as liability, then you obtain coverage of $20,000. The liability pays for a guest’s medical bills if an accident occurs at your home.

Hospitals cost quite a bit, though. An overnight stay costs about $8,000, so if the guest needs more than one night’s stay or more than one person gets hurt, your liability costs exceed your home policy coverage.

If you carry umbrella insurance, as soon as your home policy pays out the last dollar, your umbrella policy kicks in and pays the rest. All costs come out of your pocket if you do not carry an umbrella policy. This includes any court settlement from the accident.

Since these policies cost just a few dollars per month, it makes good sense to purchase one. Contact Insurance & Financial Services Inc. serving Baton Rouge, LA for help getting started with this crucial secondary insurance.