Umbrella Insurance: An Airbag For Your Net Worth – Finger Financial Five #124

“Misery is the company of lawsuits.” – Francois Rabelais

You have done a great job building wealth. Now it is time to protect it. Wealthy people like yourself have all the legal documents already in place. 

An often overlooked but effective way to protect your hard-earned assets is umbrella insurance. It is like an airbag to protect your net worth. 

Umbrella insurance is an extra layer of insurance that covers claims above your typical insurance policies. 

For example, you may have liability coverage on your automobiles up to $300,000. You may also have $500,000 liability coverage on your homeowner’s policy. Liability insurance is a seatbelt for your car. An umbrella policy covers above these liability limits…like an airbag. If the seatbelt doesn’t hold, the airbag protects you. 

Suppose you are sued for $2 million for an automobile accident. In the example above, the first $300,000 is covered by the automobile liability policy. The $1.7 million could be covered by the umbrella. 

Unfortunately, there are many ways you can be open to lawsuits. For example, you could have a dog that bites someone, a family member rear-ends a school bus, or someone could slip and fall on your property. 

Additional risks could be having a swimming pool, hosting large parties, or serving on charitable boards. 

Usually, umbrella policies cover bodily and psychological injuries but may even cover slander, libel, and defamation. 

How much do you need? In general, get coverage up to your net worth. If you are worth over $10 million, discuss the pros and cons with your attorney, financial advisor, or insurance agent. 

Several factors influence the cost of your insurance coverage. First, the number and location of your owned properties play a significant role. Second, your driving history and the number of vehicles you own also impact the cost. Moreover, the types and quantities of boats you possess add to the overall expense. Lastly, the amount of existing liability coverage you carry is another crucial factor affecting your insurance cost.

The cost could be as low as $100 to $300 monthly to get $5-10 million of coverage. 

If a lawsuit comes raining down on you, you will be glad you have an umbrella for some protection. (I am so punny).

Let me know if you have any questions.  Please email me at [email protected] or CLICK HERE to schedule a phone appointment.

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Financial Advisor is Jeremy Finger

The firm name is Riverbend Wealth Management

Advisor’s email address is [email protected]


On the lighter side, Elliott went to Disney World for a school trip this week. So what is that all about? I hope he learns something and doesn’t get into trouble. Chess victory for dad this week. I won 60% of the games.  

Hope all is well with you and your family,


Finger Financial Five – 5 points in 5 minutes or less – is to provide you with a weekly shot of useful financial information.  My intention is to share principles, so that you will have more clarity and peace, that help you make better financial decisions.

Investment advice offered through Stratos Wealth Advisors, LLC, a registered investment advisor.  Stratos Wealth Advisors, LLC and Riverbend Wealth Management are separate entities.

This content is developed from sources believed to be providing accurate information and provided by Riverbend Wealth Management. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. Stratos Wealth Partners and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.


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