Umbrella insurance protects your savings and assets if you're sued for more than your home or auto liability covers — and many seniors have more to protect than they realize.
Who needs umbrella insurance?
You're a strong candidate for umbrella insurance if your assets — home equity, savings, investments, and retirement funds — exceed the liability limits on your existing home and auto policies. A serious at-fault accident or injury on your property can produce a judgment that wipes out those assets, and umbrella coverage steps in above your underlying limits. Higher-risk situations raise the need: owning a pool or trampoline, renting out property, having teen or frequent drivers, hosting often, or owning a boat. Even retirees on fixed incomes benefit, because a lawsuit can target future income and savings. Call 1-800-MEDIGAP at 1-800-633-4427 to talk it through.
When might you not need it?
If your total assets are modest and well within your existing home and auto liability limits, and you have low lawsuit exposure — no rental property, pool, frequent guests, or high-risk activities — an umbrella policy may be optional. That said, future earnings and savings can also be at risk in a large judgment, so the decision isn't only about today's net worth. Given that $1 million in coverage often costs just $150–$300 a year, many people find the protection worth far more than the premium. Comparing your assets to your current limits is the clearest way to decide.