How Much Does Umbrella Insurance Cost - ALLCHOICE Insurance - North Carolina

Umbrella Insurance Cost: All You Need To Know

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Return To: Umbrella Insurance – The Ultimate Guide

There’s a chance that you’ll one day find yourself liable for an auto or homeowners accident. 

Given this scenario, it doesn’t mean that you have to suffer because of it for the rest of your life. 

Fortunately, there are insurance policies that help you prevent issues like wage garnishment or lawsuits that go after your Net Worth.

Umbrella insurance is the solution! 

Read on to learn more about what this policy is and how much umbrella insurance cost.

How Much Does Umbrella Insurance Cost?

Depending on what state you live in and what your assets are at the moment, you can have different costs for specific types of umbrella policies. Aside from that, there are other factors that can tell the insurance company if you are eligible to get a higher umbrella policy than what you hope to get. Here are some of them:

  • Number of dependents
  • Frequency of involvement in accidents
  • Number of filed insurance claims

More Auto Insurance Claims = Higher Umbrella Costs

If you’re applying for umbrella insurance with a different company, this company will coordinate with the one where you signed up for auto insurance. With permission and due process, they will retrieve the relevant data and review all the auto insurance claims that you filed for.

Once the company finds out that you did not file for any claim, you will be given a relatively low umbrella insurance cost. If you have more insurance claims, this means that you’re more likely to get into accidents and have other problems concerning your car. Because of that, the insurance company will have a higher risk of shelling out more money. To help them minimize their loss, they have to increase the cost of your umbrella policy.

In case you have dependents, the insurance company will also check if they had insurance claims in the past. These may either be under their names or under yours. If this is the case, it’s the company’s right to increase the umbrella costs based on their predetermined ratings.

Driving Experience & Driving Record Matter

One way that insurance companies will check for your driving experience and your driving records is through your license. They will check with the respective office for your records. Not only will they review the records for the past year but also for the last three to five years before your application for umbrella insurance. 

They will check for records of accidents and possible traffic violations on your end. The more that your records show involvement in violations and accidents, the higher your umbrella insurance cost will be. This is because there’s a higher chance that you will use your umbrella insurance coverage in the near future. 

Like in auto insurance claims, they are trying to minimize their losses by letting you finance the policy at a higher rate. Because you have a higher chance of filing for umbrella claims, this is practical instead of repeatedly getting new umbrella claims from different insurance companies.

Rental Properties Matter

More rental properties mean that you need to pay for higher umbrella insurance fees. This is because you have more tenants who may encounter problems with your properties sooner or later. If the accidents happen because of faulty or deteriorating facilities, there’s a higher chance they will sue you and demand you to pay for damages.

To avoid financial problems such as income loss, the insurance company will provide coverage. This coverage will help pay for the lawyer, the complainants, and the damage incurred in the property. Each state has slightly different laws that tackle this concern. You need to discuss these with the insurance company for clarity.

Umbrella Insurance Cost Comparison

To date, here are some of the best umbrella insurance policies out there. The annual cost and coverage estimates can help you visualize how much you may need to spend. However, you should take note that the costs may go up depending on the specific types of umbrella coverage that you want to get. The umbrella insurance cost will also depend on your current assets.

CompanyType of Umbrella CoverageEstimated Cost Per YearCoverage
GEICOVacation rentals$150$1 million
AllstateWatercraft and other recreational vehicles$150 to $1,500$1 million to $10 million
TravelersSmall-scale businesses$150 to $1,500$1 million to $10 million
ChubbMiddle-range to large-scale businesses$150 to $3,000$1 million to $100 million
USAAArmed services$150 to $600$1 million to $5 million
Liberty MutualPersonal and professional$500$35 million

Personal Umbrella Insurance Quote

In general, if an umbrella policy can provide you with $1 million worth of funds in coverage, you need to spend at least $150 to $300 per year. That is roughly $13 per month. 

If you think about it, the personal umbrella insurance rates are affordable compared to the peace of mind that you’ll get even if you get in an accident. 

Your dependents are also covered when they get into a similar situation. You have to clarify with the insurance company what their definition of a dependent is. 

This is to ensure that all the members of your immediate family will be adequately covered by this insurance policy. Reach out to insurance companies for personal umbrella insurance quotes with questions.

Is Umbrella Insurance Worth the Cost?

In a nutshell, yes. The umbrella insurance cost is worth it if you want peace of mind. After all, it can give you protection against lawsuits and claims due to most accidents. In the long run, this protects your future income by avoiding wage garnishment. 

Unless you’re planning to wreak havoc in different parts of the country, this is a good policy to get. This is because it can provide financial help for both parties in the long run. This is also a good insurance policy to get if you have teens with unstable driving skills or tenants who seem to neglect their responsibilities on your property.

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