Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 04-30-2015, 06:01 PM   #41
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Vermont & Sarasota, FL
Posts: 16,407
Quote:
Originally Posted by sheehs1 View Post
I do not have an umbrella policy but after several threads on this topic (and a couple of recent auto accidents in our area), I called my insurance company today to get quotes. My homeowners currently carries a half million on both vehicle and house (in case someone falls. While I do not typically like insurance, in todays society I don't think that is enough and it's no where near my net worth. It does seem to be about (1) getting a little leverage so your insurance company is more on the hook and will held defend (2) a bit more peace of mind at a relatively cheap cost.

Until now, anyone working in my yard or on my house that was not insured had to sign a piece of paper stating "they would not sue me and take full responsibility for choosing to do the work", disclosure regarding knowledge that I had a dog, etc. My sister had a friend that visited her home, fell and sued her. It wasn't much but still it is the point of the matter.

Hopefully putting something in place will greatly reduce the risk of someone taking all of my available assets. Thanks to the poster for restarting this topic.
When I put my umbrella in place, I found it was cheaper to increase the base policies to their max and then add a smaller umbrella than to leave the base policies where they were and add on a larger umbrella. YMMV.
__________________

__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
pb4uski is online now   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 04-30-2015, 06:36 PM   #42
gone traveling
 
Join Date: Sep 2013
Posts: 1,248
I have umbrella policy. It is useful but if the award is 10 million and you have umbrella for 3 million plus 3 Million net worth they will collect insurance and your money....

Now 401ks, IRAs, Homestead and kids Trust fund they will not collect. I keep this in my mind when making investment decisions.

In Florida also annuities and house of ANY value is protected from creditors.... So you can pretty much park all your money there and don't need Umbrella. I guess that is why OJ selected that as his state of residence after infamous trial
__________________

__________________
eta2020 is offline   Reply With Quote
Old 04-30-2015, 08:42 PM   #43
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,687
Quote:
Originally Posted by pb4uski View Post
The reality is that any low-life who can find a low-life lawyer to take their case can sue anyone for as much as they want so of course it is possible that I could get sued for more. But since my my insurer is one the hook for the first $2.5 million or so between base policy coverage and the umbrella they have a high incentive to provide a vigorous defense.

I don't know anyone who has an umbrella for more than their net worth as you seem to be suggesting. Are you an insurance agent?
No, my point is that net worth has no place in determining the amount of insurance one would need. Most of the net worth would not be even at risk, assuming a goodly portion of assets are in protected status.

If one only has a 1 million of assets that could be at risk in a lawsuit does that then mean that only 1 million of insurance is needed? Or if total assets are 2 million would 2 million be needed? The portfolio is not being insured your actions are being insured. I realize that insurance companies look to see what your total assets are to be sure you have an insurable risk, but lawyers suing you look at total amount available to sue and the insurance company is protecting your actions, your assets are just by themselves. The one advantage I know of is if an insurance company has the opportunity to settle a claim for an amount within the policy limits and they do not do so, then the insurance company may be held liable for the full amount of damages that result from a jury verdict.


The question I feel needs to be answered is how likely is an action going to occur that would exceed the value of your base insurance but use only a portion of your umbrella? This would be lawsuits that results in a final claim of between 500K and 1.5K with a one million dollar umbrella policy and some normal insurance. As the rates show the risk is practically nil, so most likely if you have to use the umbrella policy there is a very high percentage chance if you reach that point, that your assets will be at risk in any case. If you are judged to have committed a crime (such as driving under the influence) and are forced to pay restitution, an umbrella policy won't cover it. Likewise, intentional acts, intentional bodily injury, intentional property injury and other willful and malicious acts by the insured are not covered. Yet these are the cases when a large payment is most likely to be initiated.

I suppose the more assets one has the more insurance one would need to try and get negotiated insurance settlements within the umbrella policy. Overall 150-200 per year is not a significant expense so probably is worth getting but it seems to me the larger the value of the assets you have at risk, the less insurance you actually have hopefully none here would ever need to be able to comment on that.
__________________
Running_Man is offline   Reply With Quote
Old 04-30-2015, 11:14 PM   #44
Recycles dryer sheets
 
Join Date: Apr 2010
Posts: 412
interesting ... thx
"the trust is an additional insured on our Homeowners policy" what does that mean?
__________________
“The problem with the world is that the intelligent people are full of doubt, while the stupid people are full of confidence.”

(—Charles Bukowski)
wanaberetiree is offline   Reply With Quote
Old 04-30-2015, 11:20 PM   #45
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Vermont & Sarasota, FL
Posts: 16,407
I guess you are entitled to your opinion, but you have failed to really explain what amount you think someone should carry.

Quote:
Originally Posted by Running_Man View Post
....I realize that insurance companies look to see what your total assets are to be sure you have an insurable risk....
I've never been asked by an insurer about total assets and have never heard of anyone that has. If you don't believe me then do a poll.

Seems to me you are doing a lot of pontificating.

And you have totally ignored the other reason I provided (twice) that the insurer has millions of reasons to provide a vigorous defense given their potential outlay.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
pb4uski is online now   Reply With Quote
Old 05-01-2015, 12:19 AM   #46
Thinks s/he gets paid by the post
 
Join Date: Mar 2010
Posts: 1,648
Quote:
Originally Posted by pb4uski View Post
And you have totally ignored the other reason I provided (twice) that the insurer has millions of reasons to provide a vigorous defense given their potential outlay.
That is the primary reason I went ahead with signing the quote for 2m today on top of my base homeowners and car insurances.

Another reason (for me) was the point made in this thread that often the lawyers will settle "out of court" for amounts that are more easily attainable than going to the expense of court, more lawyers and fighting for personal assets.

Both made a lot of logical sense (to me). Plus it is cheap.

What are the risks or the likelihood RunningMan? I think the better question is "what do you risk by not having some level of it?
__________________
sheehs1 is offline   Reply With Quote
Old 05-01-2015, 12:40 AM   #47
gone traveling
 
Join Date: Nov 2013
Location: Los Angeles
Posts: 202
Ric Edelman was talking about excess liability insurance recently. He highly recommends it if you have money to sue for because it's SO CHEAP. Protect your nest egg!
__________________
ETFs_Rule is offline   Reply With Quote
Old 05-01-2015, 09:51 AM   #48
Thinks s/he gets paid by the post
 
Join Date: May 2014
Posts: 2,968
Quote:
Originally Posted by Golden sunsets View Post
Athena; Our home is in a Revocable Trust as well. I contacted our insurance agent yesterday regarding naming the trust as additional insured on the home and was told today that we would have to rewrite our homeowners policy in the name of the Trust and it would have to be insured as a "Rental". We would then have to have a Renter's Policy to cover our personal property. I am waiting for the quotes, but I'm anticipating higher overall premiums. Does any of this ring a bell with you?
That's not the response we got at all. They just added the Trust as a Named Insured to our regular Homeowners policy. That might be because it's called the Athena53 Trust and I'm the sole Trustee. We have all our policies with Travelers.
__________________
athena53 is offline   Reply With Quote
Old 05-01-2015, 09:59 AM   #49
gone traveling
 
Join Date: Sep 2013
Posts: 1,248
Quote:
Originally Posted by ETFs_Rule View Post
Ric Edelman was talking about excess liability insurance recently. He highly recommends it if you have money to sue for because it's SO CHEAP. Protect your nest egg!
But it does not protect it. What it does is cover first X Million of liability. If you owe more than X Million it comes out of your pocket.

It is not like if you have net worth of 4 Million buy 4 Million liability insurance and you all safe
__________________
eta2020 is offline   Reply With Quote
Old 05-01-2015, 10:16 AM   #50
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,687
Quote:
Originally Posted by pb4uski View Post
I guess you are entitled to your opinion, but you have failed to really explain what amount you think someone should carry.



I've never been asked by an insurer about total assets and have never heard of anyone that has. If you don't believe me then do a poll.

Seems to me you are doing a lot of pontificating.

And you have totally ignored the other reason I provided (twice) that the insurer has millions of reasons to provide a vigorous defense given their potential outlay.
Sorry if my posts are annoying you, it was not my intention and this will not happen again. In my corporate job part of my duties for many years was being responsible for overseeing insurance policies and my experience is that insurance companies are very happy to take umbrella premiums but work very hard at looking for exclusions when a claim occurs, occurring in much the manner as this claim against State Farm:
http://mdcourts.gov/opinions/coa/2013/48a12.pdf
So to me it requires a level of understanding what you are actually insuring because I do believe the insurance company is worrying about their pocketbook not yours, and their best defense is to look for an exclusions of coverage in the policy unfortunately and not in joining with me in defense of my actions and awards against me. However this insurance is very cheap, my bias is from my former interactions with insurance companies on a corporate level and there are many examples where it has been beneficial and definitely not at all needing this level of analysis. I personally do not carry umbrella insurance.
__________________
Running_Man is offline   Reply With Quote
Old 05-01-2015, 11:46 AM   #51
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Vermont & Sarasota, FL
Posts: 16,407
Did you even read the link?

This was where the insured suffered an injury from their own accident and was suing their insurer. They were paid under the base policy but were also trying to get more money by filing a claim under the umbrella. It isn't even close to the situation that most of us buy umbrella insurance for where there is some sort of accident that injures a third party. I think very few people buy an umbrella to get a payday from our insurer should we have an accident.

In this case, the woman and her husband had an accident, she was injured and he died, and then she sues their insurer for damages caused by her injury and for her husband's death. I didn't read the whole opinion but from the first few pages I agree with the court's conclusion and that the petitioner was overreaching.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
pb4uski is online now   Reply With Quote
Old 05-01-2015, 11:55 AM   #52
Full time employment: Posting here.
Golden sunsets's Avatar
 
Join Date: Jun 2013
Posts: 734
Quote:
Originally Posted by athena53 View Post
That's not the response we got at all. They just added the Trust as a Named Insured to our regular Homeowners policy. That might be because it's called the Athena53 Trust and I'm the sole Trustee. We have all our policies with Travelers.
After a battle royal with my current insurer, they have admitted that their insistence that the policy had to be changed was based on their assumption that the Trust was Irrevocable (despite my statement initially that the home was in the name of a Revocable Trust). They will add the Trust as an also insured and also add the Trust as an also insured on the Umbrella Liability. Now back to determining how much Excess to carry.

I did learn one important thing, which relates to Uninsured and Underinsured Motorists coverage, which we are told by a friend who is a Personal Injury attorney, is extremely important, greatly misunderstood and an item most people don't protect enough against. I have found that we can lower our liability coverage on the autos(from the current 1MM/1MM to 250M/500M), while leaving the uninsured motorists at the highest level(1MM), thus reducing the cost of auto policy, but not reducing the UI coverage. The reduction in the cost will help offset the increase in the Umbrella policy. My agent originally told me yesterday that the liability coverage and UI coverage went hand in hand, so a reduction in Liability would also mean a reduction in UI.

I gather from our attorney friend that Chubb is really the best out there and will write additional Excess UI coverage as part of the Excess Umbrella Liability therefore we are pricing all of our policies with them. I know the cost will be higher - it will be interesting to see how much higher.
__________________
Golden sunsets is offline   Reply With Quote
Old 05-01-2015, 03:33 PM   #53
Full time employment: Posting here.
Golden sunsets's Avatar
 
Join Date: Jun 2013
Posts: 734
Quote:
Originally Posted by Running_Man View Post
Sorry if my posts are annoying you, it was not my intention and this will not happen again. In my corporate job part of my duties for many years was being responsible for overseeing insurance policies and my experience is that insurance companies are very happy to take umbrella premiums but work very hard at looking for exclusions when a claim occurs, occurring in much the manner as this claim against State Farm:
http://mdcourts.gov/opinions/coa/2013/48a12.pdf
So to me it requires a level of understanding what you are actually insuring because I do believe the insurance company is worrying about their pocketbook not yours, and their best defense is to look for an exclusions of coverage in the policy unfortunately and not in joining with me in defense of my actions and awards against me. However this insurance is very cheap, my bias is from my former interactions with insurance companies on a corporate level and there are many examples where it has been beneficial and definitely not at all needing this level of analysis. I personally do not carry umbrella insurance.
Thank you for this Running_Man. I'm the OP and I'm in the midst of sorting out increasing coverage under our Umbrella, making sure that our home is properly covered as it is in a Trust and now the Uninsured Motorist issue. Our policies are with State Farm. I have just found out that our Umbrella includes additional coverage for Uninsured motorists (we are grandfathered in as we have owned the policy for so long - new policies do not include UI in Umbrellas I am told unless one uses Chubb or similar premium policies). This case is an example of one I would never have thought of (husband the driver at fault and deceased, so wife((survivor)) trying to claim on UI under their joint Umbrella). Never the less as you point out insurers are always looking for an out, so I will queery our Agent on this specific example as it relates to our State Law and our specific policy. Thank you for your info.
__________________
Golden sunsets is offline   Reply With Quote
Old 05-01-2015, 03:36 PM   #54
Thinks s/he gets paid by the post
Big_Hitter's Avatar
 
Join Date: May 2013
Location: In the fairway
Posts: 4,092
Quote:
Originally Posted by pb4uski View Post
I've never been asked by an insurer about total assets and have never heard of anyone that has. If you don't believe me then do a poll.
they asked me when I wanted to bump mine to $2M


next question - if I hit something while driving my golf cart with that be covered under the umbrella policy?


__________________
Swing hard, look up
Big_Hitter is offline   Reply With Quote
Old 05-02-2015, 03:21 PM   #55
Recycles dryer sheets
 
Join Date: Apr 2015
Posts: 82
I just renewed my Umbrella policy yesterday. 1 Million in coverage for $345 a year with AAA. Sort of surprised that some of you guys are getting a better deal then me.
__________________
Drake3287 is offline   Reply With Quote
Old 05-02-2015, 03:27 PM   #56
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
travelover's Avatar
 
Join Date: Mar 2007
Posts: 9,874
Quote:
Originally Posted by Drake3287 View Post
I just renewed my Umbrella policy yesterday. 1 Million in coverage for $345 a year with AAA. Sort of surprised that some of you guys are getting a better deal then me.
It is based on risk. Do you run with scissors?
__________________
Yes, I have achieved work / life balance.
travelover is offline   Reply With Quote
Old 05-02-2015, 03:31 PM   #57
gone traveling
 
Join Date: Nov 2013
Location: Los Angeles
Posts: 202
Quote:
Originally Posted by Drake3287 View Post
I just renewed my Umbrella policy yesterday. 1 Million in coverage for $345 a year with AAA. Sort of surprised that some of you guys are getting a better deal then me.
I'm with Allstate (middleman). RLI (Peoria, iL) is the excess liability insurer. It was $425 for $2 million. It's $236 for 1$ million.
__________________
ETFs_Rule is offline   Reply With Quote
Old 05-02-2015, 04:28 PM   #58
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,317
Quote:
Originally Posted by Drake3287 View Post
I just renewed my Umbrella policy yesterday. 1 Million in coverage for $345 a year with AAA. Sort of surprised that some of you guys are getting a better deal then me.
My premium is similar to yours. I did get competitive quotes before I renewed with Liberty mutual from multiple insurance companies in my area and the total cost of policies (i.e autos, home and umbrella) were not too far apart.

So if you live in a high cost of living state it may explain the higher premium.
__________________
Corporateburnout is offline   Reply With Quote
Old 05-02-2015, 06:26 PM   #59
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,612
Quote:
Originally Posted by Drake3287 View Post
I just renewed my Umbrella policy yesterday. 1 Million in coverage for $345 a year with AAA. Sort of surprised that some of you guys are getting a better deal then me.
Mine is $1M with USAA, and it was $159. Maybe living in a church-owned parsonage and not owning real estate helps.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
ziggy29 is offline   Reply With Quote
Old 05-02-2015, 06:44 PM   #60
Administrator
Gumby's Avatar
 
Join Date: Apr 2006
Posts: 10,137
Quote:
Originally Posted by ziggy29 View Post
Mine is $1M with USAA, and it was $159. Maybe living in a church-owned parsonage and not owning real estate helps.
I'm sure that your not owning real property is a big factor in the price you pay, since injuries on your property are a major source of exposure for insurers. Ours is $1M with USAA, on top of $500K/1M auto liability and $500K homeowner liability. $378 per year premium.
__________________

__________________
Living an analog life in the Digital Age.
Gumby is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
How much liability insurance do you carry? Gazingus FIRE and Money 79 01-20-2015 02:30 PM
Liability coverage challenge brewer12345 FIRE and Money 9 11-19-2014 12:45 PM
Here's an idea if you have excess cash not earning much interest Dimsumkid Other topics 2 07-28-2011 07:50 PM
When is a carry-on not a carry-on? Rich_by_the_Bay Travel Information 56 12-18-2009 08:19 PM
Personal Umbrella versus Personal Excess Liability policies ? Linney FIRE and Money 25 11-28-2006 08:06 PM

 

 
All times are GMT -6. The time now is 12:50 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.