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Old 02-02-2013, 08:34 AM   #21
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Consider leaving your 401K at your employer when you leave if you don't need immediate access to it. The ERISA protection if you value it should be balanced against the various reasons usually given to roll it over into an IRA.
Sometimes in the 401K you have access to institutional class funds that have lower ERs and if you are lucky, the employer may take care of much of the other expenses.
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Old 02-02-2013, 08:51 AM   #22
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... and by remaining single.
That, and an umbrella policy, are my primary means of protection for now.
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Old 02-02-2013, 08:53 AM   #23
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If you drive a car, the biggest potential liability is a large lawsuit against you in the event of serious injury and you are at fault. An add on to the auto insurance policy will give higher coverage limits at a reasonable cost.
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Old 02-02-2013, 08:55 AM   #24
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....and by remaining single.
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That, and an umbrella policy, are my primary means of protection for now.
And mine is an umbrella policy and remaining married.
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Old 02-02-2013, 09:00 AM   #25
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If you drive a car, the biggest potential liability is a large lawsuit against you in the event of serious injury and you are at fault. An add on to the auto insurance policy will give higher coverage limits at a reasonable cost.
Umbrella policies require you to have certain levels of coverage on your auto policy. My USAA umbrella policy requires me to carry $300K/$500k bodily injury and $100k property damage limits.
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Old 02-02-2013, 09:10 AM   #26
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Agree with what Ziggy said. I have an umbrella policy and most of my assets are in retirement accounts. Of course taxable assets are probably fair game.
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Old 02-02-2013, 11:24 AM   #27
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Umbrella policies require you to have certain levels of coverage on your auto policy. My USAA umbrella policy requires me to carry $300K/$500k bodily injury and $100k property damage limits.
+1

Umbrellas coordinate with auto and homeowners (renters I suppose as well) policies. No need to add more than required to auto policies beyond that point.
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Old 02-02-2013, 12:44 PM   #28
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Is it true one should insure equal to their assets?
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Old 02-02-2013, 01:00 PM   #29
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Most umbrella policies are in the millions so the insurance companies have incentive to defend you.
That legal defense is one of the main values of an umbrella policy.
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Old 02-02-2013, 01:10 PM   #30
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Is it true one should insure equal to their assets?
I'd say it depends on where you live. See Ziggy's post above (#3).
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Umbrella Policy
Old 02-02-2013, 01:19 PM   #31
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Nothing. I just avoid litigation at all costs professionally and personally...keeping a low profile, staying out of trouble in general, and by remaining single.
This describes my current approach.

I have actually inquired about an umbrella policy a couple of times with my insurance agent; and, they have talked me out of it both times. This does seem like a layer of protection that I should add; but, like adding more fiber to my diet, is just something I have not pursued yet.

I would appreciate thought on whether an umbrella policy should be with the same company as the home and/or auto or be diversified to a separate company.

Has anyone here actually had to utilize the protections of an umbrella policy and willing to share details, outcomes, process and such?
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Old 02-02-2013, 01:25 PM   #32
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I would appreciate thought on whether an umbrella policy should be with the same company as the home and/or auto or be diversified to a separate company.
Since the coverages on the policies are all coordinated you will likely get better rates by staying with one company.
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Has anyone here actually had to utilize the protections of an umbrella policy and willing to share details, outcomes, process and such?
Thankfully, I can't speak to this one.
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Old 02-02-2013, 01:35 PM   #33
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I have actually inquired about an umbrella policy a couple of times with my insurance agent; and, they have talked me out of it both times. This does seem like a layer of protection that I should add; but, like adding more fiber to my diet, is just something I have not pursued yet.

I would appreciate thought on whether an umbrella policy should be with the same company as the home and/or auto or be diversified to a separate company.

Has anyone here actually had to utilize the protections of an umbrella policy and willing to share details, outcomes, process and such?
Some insurers will only provide umbrella if they also cover auto or homeowners. USAA requires homeowners (IIRC) and State Farm requires auto (our case). Why would an agent talk you out of buying coverage from them - unless they don't sell it.
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Old 02-02-2013, 01:47 PM   #34
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Is it true one should insure equal to their assets?
Obviously this is a personal decision as to how much to insure for just like with any other insurance. However, I have personally always felt that the amount of insurance to obtain has to do with one's exposure not the amount of your assets. Having said that, there is an argument to be made that if someone has NO assets or minimal assets there is nothing really there to protect and most (but not all) claims could be hypothetically eliminated through bankruptcy.

Let's say, however, you have $1 million in non-exempt assets and so you get $1 million in insurance since that equals your assets. That's fine if someone makes a $500,000 claim against you. But what if the claim is $5 million? Assume you lose and the insurance pays off $1 million. The claimant then theoretically comes after your $1 million in assets and takes those and then you still owe $3 million. You could theoretically file bankruptcy to wipe away the ongoing liability (assuming the case is one that can be discharged) or, if you don't (or can't) then the judgment hangs around and if you get money in the future the creditor could try to collect whatever you get. (Obviously all this depends on state law)

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Has anyone here actually had to utilize the protections of an umbrella policy and willing to share details, outcomes, process and such?
Not personally for me as an individual. But I've had dealings with umbrella coverage in my work. Every policy is different and you can't totally generalize at all. Typically if there is a primary policy then the primary carrier defends until that policy is exhausted. At that point the umbrella carrier may or may not have a a duty to come in and defend. That is policy specific.

The most important thing for most people to know is that you must pay attention carefully as to when notice is required to be given to the umbrella carrier. Sometimes, when a claim comes in, people think it is a small claim (below the limit of the primary policy) and don't give notice to the umbrella carrier. Then, later - often much later - they realize the claim is a big claim that theoretically could exceed the limits of the primary policy so they give notice to the umbrella carrier. Then the carrier refuses to cover on the ground that notice is late. For that reason it is very, very, very important to always look at the notice requirements to make sure notice is given in the time and manner required.


Just for the obligatory CYA - None of this is specific legal advice to anyone here. This is general information. You should absolutely consult with your own attorney on anything legal related and should not rely on anything that I say whatsoever. I'm not your attorney.
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Old 02-02-2013, 01:53 PM   #35
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The most important thing for most people to know is that you must pay attention carefully as to when notice is required to be given to the umbrella carrier. Sometimes, when a claim comes in, people think it is a small claim (below the limit of the primary policy) and don't give notice to the umbrella carrier. Then, later - often much later - they realize the claim is a big claim that theoretically could exceed the limits of the primary policy so they give notice to the umbrella carrier. Then the carrier refuses to cover on the ground that notice is late. For that reason it is very, very, very important to always look at the notice requirements to make sure notice is given in the time and manner required.
CYA duly noted, but if the claim is against your auto policy and your umbrella policy is with the same carrier, this requirement to notify should not be an issue, correct?
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Old 02-02-2013, 02:22 PM   #36
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Is it wise for people to disclose the details of their asset protection plan to strangers on the internet?
Easy answer
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Old 02-02-2013, 02:24 PM   #37
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CYA duly noted, but if the claim is against your auto policy and your umbrella policy is with the same carrier, this requirement to notify should not be an issue, correct?
Incorrect.

Obviously this may depend upon policy provisions, but often who you have to give notice to is different between primary and umbrella policies even with the same carrier.

Also sometimes people give the policy number of the primary policy when giving notice and might not mention the umbrella policy and that might be considered notice only on the primary policy even though both policies are with the same carrier.

Another thing is that there may be subtle differences in the carrier even though they are part of the same "family" of carriers. That is, the primary policy might be with X Insurance Company while the excess is with X Indemnity Company, etc. or even the primary with X Insurance Company while the excess is with X Insurance Company of New York.

Sometimes, the primary and umbrella policies have different provisions as to how to give notice and when it is to be given as well.

If both policies were with the exact same company and both had the same address for notice to given and both had the same notice requirements - if it was me, personally, when I gave written notice I would put in my notice the policy number for both policies and not just the primary policy. Obviously - all this depends upon specifics of the policies in question.
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Old 02-02-2013, 02:42 PM   #38
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Same insurance co (USAA), same address for notification, same policy numbers for homeowner, auto and umbrella except for a two digit suffix. You really think they could get away with refusing to cover me under my umbrella policy because I failed to include those two digits when I notified them of a loss under my auto or HO policy?
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Old 02-02-2013, 02:51 PM   #39
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Has anyone here actually had to utilize the protections of an umbrella policy and willing to share details, outcomes, process and such?
Unfortunately, I have. I won't go into too much detail (to keep search engines from picking up on certain keywords) but I had an unsavory tenant try to sue me to gain ownership of a house because they said my dad's estate wasn't probated properly.

I had coverage on the house as well as an umbrella policy, both with the same company. I was assigned a Jr. lawyer at a very aggressive litigation firm in my city. They got the case dismissed with prejudice, so it's a done deal.

It still cost me in excess of $10,000 to get them evicted (+4 months), but the legal fees for the lawsuit were taken care of, which I believe were about $22,000.

As I said, it's a much longer story, but I believe Uncle Sam has some special plans for this clown. And, they are also watched by local and federal law enforcement agencies. I could write a book....

And now you know why I hate investment real estate. But I will forever be a customer of the agency who covered my back side for this lawsuit.
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Old 02-02-2013, 02:59 PM   #40
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Same insurance co (USAA), same address for notification, same policy numbers for homeowner, auto and umbrella except for a two digit suffix. You really think they could get away with refusing to cover me under my umbrella policy because I failed to include those two digits when I notified them of a loss under my auto or HO policy?
It is not a risk that I would take if it was me. I would personally include both policy numbers in giving notice. I think that lessens uncertainty and would be the more prudent course of action for me to take.
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