Author Topic: Umbrella insurance  (Read 11488 times)

hillfronter83

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Umbrella insurance
« on: January 10, 2015, 10:47:12 AM »
I would like to pick the wisdom of this board regarding this topic: How much coverage would you suggest? What is the cost? I have built a decent amount of savings, of which about half are in IRA and 401K, the remaining are investments and equity in my home. Your thoughts are highly appreciated.


bookie71

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Re: Umbrella insurance
« Reply #1 on: January 10, 2015, 11:56:36 AM »
Check with your agent as the coverage is cheap.  Probably your IRA and 401 K are exempt from all but the IRS under ERISA.
I remember how shocked i was when I found out that I could get 1,000,000 extra coverage for only $25.00.  This was several years ago, so it might have gone up.
Always remember, Pigs get fat and hogs get slaughtered.

Jurgis

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Re: Umbrella insurance
« Reply #2 on: January 12, 2015, 09:35:28 AM »
$25 for 1M??? Where can I get such rate??

I'm in Massachusetts. A year or so ago got quote for $380 for 1M, $680 for 2M from Geico-recommended company (Geico does not offer umbrella in MA).

AAA insurance quoted $200 for 1M but only if I transfer all my house/car insurance to them. I have house insurance with them, but they refused to offer umbrella if the car insurance was elsewhere.

Might be MA, but these prices seemed very steep for me.
"Before you can be rich, you must be poor." - Nef Anyo

leeway

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Re: Umbrella insurance
« Reply #3 on: January 12, 2015, 10:12:03 AM »
25 for extra 1M policy is still very cheap. I have Geico and the difference between 1M and 2M is about 150, a little over 400 for 2M.

I think 401K money are mostly protected from creditors, but not IRAs. So I hesitate to convert 401Ks to IRAs.  Anyone has a different opinion on this?

adesigar

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Re: Umbrella insurance
« Reply #4 on: January 12, 2015, 04:30:00 PM »
From what I remember 401ks are fully protected. IRA's depend on state

http://www.irafinancialgroup.com/selfdirectedassetprotection.php

benchmark

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Re: Umbrella insurance
« Reply #5 on: July 07, 2017, 09:53:35 AM »
Resurrecting this thread.

How much umbrella insurance should one get? How to think about this?

There are talks about getting coverage equal to your assets, but that obviously doesn't make sense. However, $1M seems to be too small as well....

thanks.

redhots

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Re: Umbrella insurance
« Reply #6 on: July 07, 2017, 10:51:31 AM »
I just did a quick quote on USAA.   $43.58/month for 1 million.    $65.36/month for 2 million. 


You are required to have these minimums for that quote.

Auto Insurance
Bodily Injury   $300,000 limit per person / $500,000 limit per accident
Property Damage   $100,000 limit per accident

Homeowners/Renters Insurance
Personal Liability   $300,000 limit per occurrence
Personal Injury Liability   $300,000 limit per occurrence

Watercraft Insurance (if applicable)
Personal Liability   $300,000 limit per occurrence

Jurgis

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Re: Umbrella insurance
« Reply #7 on: July 07, 2017, 11:11:43 AM »
There are talks about getting coverage equal to your assets, but that obviously doesn't make sense. However, $1M seems to be too small as well....

From the last sentence, I assume you are talking about assets being >$1M.

IMO if assets are $1M-$10M or so, it makes sense to get umbrella equal to your assets. Might depend on price of course. Or less than assets if you are OK losing the "over-umbrella" part in a really bad situation.

Edit2: Actually, scratch the above. Umbrella does not guarantee that you will keep any of your assets. It's only a buffer. So the question is really for how much you can be sued in really bad situation. E.g. you drive over 10 schoolchildren. Probably $10M+. So... you might need umbrella even higher than your assets if you think that's a possible risk.

If assets are >$10M, you probably can "self-insure" and assume that you'd be able to fight off or settle any litigation without losing more than $10M... perhaps. I don't really know. Might depend on how rich/exposed you are.

Although I still don't have umbrella at all (mostly for reasons that don't apply to others, though price is a bit crappy too), so ./shrug  ::)

Edit: redhots USAA quote seems close to what I was quoted in MA. A bit higher actually, but it's possible you can get better deal that USAA quote depending on state and your car/house insurance and who's insuring all that.
« Last Edit: July 07, 2017, 11:17:40 AM by Jurgis »
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KJP

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Re: Umbrella insurance
« Reply #8 on: July 07, 2017, 11:29:07 AM »

IMO if assets are $1M-$10M or so, it makes sense to get umbrella equal to your assets. Might depend on price of course. Or less than assets if you are OK losing the "over-umbrella" part in a really bad situation.


If your assets are well into the seven figures, there are asset protection measures that you should discuss with an attorney or financial planner who specializes in that area.  That is particularly true if you work in a field where you are personally liable for your negligence/malpractice and you take on work that could lead to seven- or eight-figure liability.

DocSnowball

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Re: Umbrella insurance
« Reply #9 on: July 07, 2017, 11:33:47 AM »
We have Amica in Connecticut
$1 million coverage, in excess of underlying coverage
$332 for a year
Roughly 25% of the annual premium for all policies combined is returned to me in the form of a "Dividend"

There are talks about getting coverage equal to your assets, but that obviously doesn't make sense. However, $1M seems to be too small as well....

From the last sentence, I assume you are talking about assets being >$1M.

IMO if assets are $1M-$10M or so, it makes sense to get umbrella equal to your assets. Might depend on price of course. Or less than assets if you are OK losing the "over-umbrella" part in a really bad situation.

Edit2: Actually, scratch the above. Umbrella does not guarantee that you will keep any of your assets. It's only a buffer. So the question is really for how much you can be sued in really bad situation. E.g. you drive over 10 schoolchildren. Probably $10M+. So... you might need umbrella even higher than your assets if you think that's a possible risk.

If assets are >$10M, you probably can "self-insure" and assume that you'd be able to fight off or settle any litigation without losing more than $10M... perhaps. I don't really know. Might depend on how rich/exposed you are.

Although I still don't have umbrella at all (mostly for reasons that don't apply to others, though price is a bit crappy too), so ./shrug  ::)

Edit: redhots USAA quote seems close to what I was quoted in MA. A bit higher actually, but it's possible you can get better deal that USAA quote depending on state and your car/house insurance and who's insuring all that.
« Last Edit: July 07, 2017, 11:35:40 AM by DocSnowball »