DEFINITION of 'Umbrella Personal Liability Policy'

A type of insurance policy that provides excess coverage above and beyond the liability coverage amounts in a standard insurance policy. The umbrella policy provides extra protection in the event that a lawsuit exceeds the basic level of coverage in the standard policy.

BREAKING DOWN 'Umbrella Personal Liability Policy'

An umbrella personal liability policy extends the basic coverage provided in different types of liability coverage, including home, auto, boat and tenant policies. This type of policy provides broad coverage, meaning that some claims that would not be covered by a standard policy may be covered under the umbrella policy. However, an umbrella policy only kicks in once the regular coverage amount is exceeded. Generally, the insured's standard policies must contain minimum levels of liability coverage that are specified by the insurance company in order to add an umbrella policy, and therefore, greater liability coverage.

RELATED TERMS
  1. Prior Acts Coverage

    A feature of an insurance policy that extends the coverage of ...
  2. Liability Insurance

    Any type of insurance policy that protects an individual or business ...
  3. Coincidental Excess Coverage

    Insurance coverage that provides excess coverage for a specified ...
  4. All Risks Coverage

    Insurance coverage for any incident that an insurance policy ...
  5. Commercial Package Policy (CPP)

    An insurance policy that combines coverage for multiple perils, ...
  6. Coordination Of Coverage

    A review or modification of an individual's or business’ insurance ...
Related Articles
  1. Insurance

    Is It Safe To Be Without Umbrella Insurance Today?

    At low cost, you can buy significant extra liability coverage in case you're sued due to an accident or other trouble. See it as bankruptcy protection.
  2. Insurance

    Umbrella Insurance: You May Need It, Too

    If you have assets to protect – or just run a business from home – you could be unpleasantly surprised at how much you need umbrella insurance.
  3. Insurance

    It's Raining Lawsuits: Do You Need An Umbrella Policy?

    This type of insurance protects your assets and future wages against lawsuits. Find out if it might benefit you.
  4. Insurance

    3 Reasons To Get Umbrella Insurance

    A relatively small annual premium can buy you a lot of peace of mind. In today's litigious society, that's money well spent.
  5. Insurance

    How to Protect Your Assets From Litigation

    Personal umbrella liability insurance can offer you big-time legal protection relatively cheaply, in case your existing policies aren't enough.
  6. Insurance

    Do You Need Umbrella Insurance For Household Help?

    Homeowners insurance may not be enough – say, if your nanny sues for damages after an accident. That's where umbrella coverage comes in.
  7. Insurance

    Insurance, Excess Insurance and Reinsurance: What's the Difference? (ALL)

    Understanding the differences might help you avoid being overinsured or underinsured.
  8. Insurance

    How Much Car Insurance Do I Need?

    Find out to determine how much car insurance you actually need with this overview of the different types of coverage available in your policy.
  9. Insurance

    For Top-Notch Insurance Coverage, Compare Quotes

    Find out how to use and compare policy options to get the best coverage at the best price.
  10. Managing Wealth

    How You Can Protect Assets With Umbrella Insurance

    Here's why protecting your assets from litigation via umbrella liability insurance is a good idea.
RELATED FAQS
  1. Does renters insurance cover dog bites?

    Learn how a renters insurance policy can provide liability coverage for dog bites and how coverage may vary by state and ... Read Answer >>
  2. Which types of coverage ratios should I look at when deciding to invest in a company?

    Find out why coverage ratios are useful for investors to know and which three coverage ratios an investor should understand ... Read Answer >>
  3. What are some examples of industries that practice price discrimination?

    Understand the various types of insurance coverage offered in the insurance marketplace, and learn why each policy should ... Read Answer >>
  4. How does the 80% rule for home insurance work, and how do capital improvements affect ...

    The 80% rule refers to the fact that most insurance companies will not fully cover the cost of damage to a house due to the ... Read Answer >>
Hot Definitions
  1. Two And Twenty

    A type of compensation structure that hedge fund managers typically employ in which part of compensation is performance based. ...
  2. Market Capitalization

    The total dollar market value of all of a company's outstanding shares. Market capitalization is calculated by multiplying ...
  3. Expense Ratio

    A measure of what it costs an investment company to operate a mutual fund. An expense ratio is determined through an annual ...
  4. Mezzanine Financing

    A hybrid of debt and equity financing that is typically used to finance the expansion of existing companies. Mezzanine financing ...
  5. Long Run

    A period of time in which all factors of production and costs are variable. In the long run, firms are able to adjust all ...
  6. Quasi Contract

    A legal agreement created by the courts between two parties who did not have a previous obligation to each other. A normal ...
Trading Center