One extra layer of insurance protection that’s worth considering is an umbrella policy. Its name has nothing to do with actual umbrellas—rather, it refers to its purpose, and fits over the top of the policies you already have for your car or home. This insurance kicks in if you exceed the limits of your regular insurance policies for your car, home, or other assets. It’s often referred to as excess liability insurance, and can come in handy if you get sued by someone with whom you’re involved in an insurance claim.
It can be a good idea for people who do the following:
Umbrella insurance doesn’t cover your own injuries or damages, but does cover others’ injuries or damages, along with your legal defense. A $1 million umbrella insurance policy costs between $150 and $400 per year.