How to File Umbrella Insurance Claims

When you're at fault for an accident, injury, or property damage, your liability coverage can protect you. But what if you don't have enough liability protection to cover the full cost of damages or litigation? That's where umbrella insurance can step in to provide the rest of the coverage you need. However, it's critical to understand when and how you should file an umbrella insurance claim to get the full reimbursement you deserve.

Fortunately, a local independent insurance agent can help you find the right umbrella insurance. They'll get you matched to the appropriate amount of coverage. But first, here's a guide to when and how to file umbrella insurance claims.

Top 5 Most Common Umbrella Insurance Claims

Umbrella insurance policies can be added to various types of existing coverage, such as homeowners insurance, renters insurance, business insurance, auto insurance, and boat insurance, to increase your total liability protection. It can be helpful to understand some specific scenarios in which you might need this excess liability protection to recoup your total losses. Here are some of the most common liability claims that umbrella insurance can cover.

1. Lawsuits: Umbrella insurance can help cover the hefty cost of lawsuits against you for many different third-party claims. This coverage can reimburse you for attorney, court, and defense costs.
2. Teen driver accidents: Umbrella insurance can help cover the cost of lawsuits and other damages associated with accidents caused by a teen driver in your household. Teens are much more likely to cause accidents resulting in third-party injuries and property damage.
3. Dog bites: Umbrella insurance can help cover the cost of medical expenses and lawsuits if someone is injured by your dog, such as a house guest or a neighbor. Dog bite lawsuits can be extremely expensive and may exhaust the liability coverage provided by your home insurance policy. 
4. Pool or trampoline injuries: Umbrella insurance can help cover the cost of medical expenses and lawsuits if a guest at your home is injured while using your swimming pool or trampoline. These lawsuits can also be expensive to the point of exhausting your home insurance's liability coverage.
5. Intoxicated guest damages: Umbrella insurance can also help cover the cost of lawsuits and damages caused by an intoxicated guest at your home or business, even after they've left your property or establishment. Intoxicated parties can cause injuries or property damage to others, resulting in a hefty lawsuit against you for serving or hosting them.

An independent insurance agent can provide you with even more examples of common insurance claims that umbrella policies can cover. 

How Does Excess Liability Coverage Work?

Your umbrella insurance kicks in to cover remaining liability expenses once your underlying policy's liability coverage has been exhausted. You can buy umbrella insurance typically in increments of $1 million. So, if you had a home insurance policy with $250,000 in liability coverage, a $1 million umbrella policy would increase your total liability protection to $1.25 million.

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Understanding How Umbrella Insurance Claims Work

If you find yourself facing a lawsuit, it's critical to ensure you have enough liability protection to fully cover the costs. Once your existing policy's liability limit has been surpassed, you're responsible for the remainder of the damages yourself. This can include money owed for property damage, injuries to a third party, or attorney expenses and defense costs.

Let’s say your auto insurance has $300,000 in liability coverage and a deductible of $1,000. If you cause a serious car accident and get sued for $1 million, you would pay your auto policy's deductible of $1,000, and your auto liability coverage would pay the remaining $299,000 if your full claim were approved. After that, since you have met your $300,000 deductible, your umbrella insurance could pay the remaining balance of $700,000. 

Ensure there isn’t a significant gap between your liability coverage and your umbrella policy's deductible, as that money must come out of your own pocket. Your independent insurance agent can help you add an umbrella insurance policy with the appropriate amount of coverage for your unique needs. They can also help you choose the right deductible.

Umbrella Insurance Can Help Protect Your Assets 

Having umbrella insurance, also known as excess liability coverage, can help protect your assets in case of a lawsuit. Without enough liability coverage, all of the following could fall prey to claims payments:

Fortunately, having enough umbrella coverage can increase your liability protection to the point that your assets can remain safe.

How to File an Umbrella Insurance Claim

If you're facing a lawsuit, you may need to use your umbrella insurance to cover the remainder of the damages not fully reimbursed by your underlying policy. To easily file an umbrella insurance claim, contact your independent insurance agent. They can contact your carrier and file claims for you directly, making the process easy and fast. 

Your agent knows all the right questions to ask to get any necessary information before filing your claim. They can even keep you updated with ETAs for every step of the process, including when you can expect to receive reimbursement from your insurance company. 

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Here's How an Independent Insurance Agent Can Help

An independent insurance agent can shop and compare umbrella insurance policies from multiple carriers near you to find the best blend of coverage and cost. Your agent knows which type of umbrella insurance to recommend, as well as how to help you secure the appropriate amount of coverage for your unique situation. And down the road, your agent will still be there to file umbrella insurance claims for you and update your policy when necessary.