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How much liability insurance do you carry?
01-15-2015, 08:40 AM
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#1
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Recycles dryer sheets
Join Date: Jan 2008
Posts: 126
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How much liability insurance do you carry?
I searched and didn't find an old thread on this topic. I've always been as self-insured as possible (risk tolerant) but last year we increased our auto liabilities to $300k per person, $500k per accident, and $100k property damage. We have the same amounts in uninsured/underinsured motorists. Previously, we had the minimum policies allowed, which were around the $50k-$100k range.
We also opted for $500k liability coverage for any accident/injury on our property. Of course, they want to sell us an "umbrella" liability policy for $1MM or more.
I hate to spend money on insurance, so I'm considering rolling these amounts back. It won't save big money, but every dollar counts, right?
Are 300/500/100 amounts common for an auto policy? Is it high/low? What do you carry? Do you have umbrella liability coverage?
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01-15-2015, 08:44 AM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2002
Location: Texas: No Country for Old Men
Posts: 50,000
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Quote:
Originally Posted by Gazingus
I searched and didn't find an old thread on this topic.
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Search 'umbrella' and you'll find a dozen or more threads discussing the subject.
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Numbers is hard
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01-15-2015, 08:45 AM
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#3
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2013
Location: Les Bois
Posts: 5,761
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umbrella is pretty cheap - I have $2M coverage
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You can't be a retirement plan actuary without a retirement plan, otherwise you lose all credibility...
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01-15-2015, 08:50 AM
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#4
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Thinks s/he gets paid by the post
Join Date: Oct 2004
Location: Portland
Posts: 2,038
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Quote:
Originally Posted by Big_Hitter
umbrella is pretty cheap - I have $2M coverage
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+1
I woke up thinking about this and wondering if I should up they amount to $3 million.
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01-15-2015, 08:50 AM
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#5
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Moderator
Join Date: Apr 2012
Location: San Diego
Posts: 14,140
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Because of our umbrella policy we had to up our liability limits on everything else.
We need an umbrella policy because we have a rental unit on our property, we have middle school age kids who are, sometimes, idiots. And because much of our nest egg is not in a 401k - and therefore exposed to lawsuits.
We have the minimum liability on auto/home/rental unit that is allowed by our umbrella.
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Retired June 2014. No longer an enginerd - now I'm just a nerd.
micro pensions 6%, rental income 20%
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01-15-2015, 08:51 AM
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#6
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2013
Location: Limerick
Posts: 5,633
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I have $4 million umbrella coverage. It's cheap compared to losing what we've worked for all our lives because of one mistake.
Sent from my iPhone using Early Retirement Forum
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01-15-2015, 10:12 AM
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#7
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Thinks s/he gets paid by the post
Join Date: Apr 2012
Location: Nashville
Posts: 2,504
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500K Combined Single Limit liability on house/cars. 3 million umbrella.
BUT, it is all going to depend upon a particular individual/couple's earnings, assets, location of assets (house, protected retirement $$, or other), and state of residence.
OTOH, as noted by several already, umbrella coverage is pretty inexpensive.
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OMY * 3 2ish Done 7.28.17
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01-15-2015, 10:20 AM
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#8
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Recycles dryer sheets
Join Date: Jan 2014
Posts: 87
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$250/$500 on Auto Liab with same for Uninsured & Underinsured, $800k on Home Liab and $1M Umbrella
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01-15-2015, 10:23 AM
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#9
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Thinks s/he gets paid by the post
Join Date: Jul 2002
Posts: 1,581
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Quote:
Originally Posted by Gazingus
I searched and didn't find an old thread on this topic. I've always been as self-insured as possible (risk tolerant) but last year we increased our auto liabilities to $300k per person, $500k per accident, and $100k property damage. We have the same amounts in uninsured/underinsured motorists. Previously, we had the minimum policies allowed, which were around the $50k-$100k range.
We also opted for $500k liability coverage for any accident/injury on our property. Of course, they want to sell us an "umbrella" liability policy for $1MM or more.
I hate to spend money on insurance, so I'm considering rolling these amounts back. It won't save big money, but every dollar counts, right?
Are 300/500/100 amounts common for an auto policy? Is it high/low? What do you carry? Do you have umbrella liability coverage?
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Wow, you must not have much in the way of assets to protect until recently. I think I went to 300/500/100 about ten years ago. Recently increased coverage to 500/1000/100. Cost very few dollars for additional liability and resulted in a decrease in my umbrella coverage. A liability lawsuit can quickly destroy my retirement plans! I save a fair amount by cutting out collision coverage once the vehicles worth drops below $10K. The worst that can happen is the vehicle is totaled, but in a lawsuit, liability could get into the 100K range very quickly.
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01-15-2015, 10:29 AM
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#10
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Recycles dryer sheets
Join Date: Jul 2013
Location: Villa Grande
Posts: 275
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Quote:
Originally Posted by Big_Hitter
umbrella is pretty cheap - I have $2M coverage
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+1. me too. I bought it shortly after I ER'd.
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01-15-2015, 10:32 AM
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#11
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Thinks s/he gets paid by the post
Join Date: Jun 2010
Posts: 2,301
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2M umbrella as well
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01-15-2015, 10:38 AM
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#12
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Thinks s/he gets paid by the post
Join Date: Feb 2012
Location: Northern Ohio
Posts: 3,181
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Even if you have coverage, it's worth shopping around every now and then.
We had our homeowners/umbrella/auto with Grange and the price had started to creep up. Then in December the bill came for 2015 and it was around almost 20% than last year.
I called our agent and she shopped around for similar coverage.
Turned out Westfield offered slightly better coverage for a lot less. We switched after checking with DB who's in the business and likes Westfield.
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01-15-2015, 10:59 AM
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#13
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Thinks s/he gets paid by the post
Join Date: Jul 2012
Location: Texas
Posts: 3,024
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Our auto coverage is 250/500/100, and we have 300 liability on the house. IIRC, these were the minimums required for our umbrella coverage. We have $1M umbrella. I'd like to go to $2M, but it's not cheap due to two rental houses and two 20-something kids still carried on my auto insurance. The kids pay their share of the auto policy, but not the umbrella. I need to kick them off soon.
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Retired at 52 in July 2013. On to better things...
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01-15-2015, 11:26 AM
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#14
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Recycles dryer sheets
Join Date: Jan 2011
Location: Scotts Hill, TN
Posts: 105
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In general I don't like insurance because it is something you buy and hope to never use.
However as far as insurance goes, liability is one of the best deals out there.
When thinking of insurance, I ask my self what are the things that could bankrupt me financially.
One of those things is a major medical issue like cancer. We can cover the small stuff, but cancer could knock us out financially. So I make sure we have medical insurance in place that covers the big stuff.
The other thing that could knock us out is a lawsuit. Not that I think it is likely, but what if we are found at fault in a major auto accident - it doesn't take long to get above $100K and if injuries are involved - could be over $1M.
Or what my livestock get out of the fence and cause an accident - or my dog gets out and destroys a neighbors property? or what if ?
Yes - liability insurance, especially umbrella insurance if your net worth is high enough to need protecting is a bargain.
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Quit my J.O.B to become a farmer/rancher - December 2011
Now working part time from home on contract to support prior employer.
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01-15-2015, 11:35 AM
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#15
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Recycles dryer sheets
Join Date: Jan 2011
Location: Scotts Hill, TN
Posts: 105
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One more thing - I like to carry high deductibles for insurance. In addition to lowering the cost of the insurance, it also makes sure I don't try to mess around filing claims for the small stuff that we can cover. Saves time/hassle and then I don't have a small claim that might count against future premium hikes. Even when people have a low deductible, if they have a small claim they often will cover themselves to avoid premium increase (or potentially being dropped).
So my philosophy is don't insure the things you can reasonably cover - but do insure the things that can take you out.
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Quit my J.O.B to become a farmer/rancher - December 2011
Now working part time from home on contract to support prior employer.
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01-15-2015, 11:46 AM
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#16
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Full time employment: Posting here.
Join Date: Jul 2014
Posts: 930
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I just increased my liability coverage to $1m for auto and took out a $2m umbrella policy. I really hadn't thought about it much previously, but as I started to do more planning for FIRE, I realized I wanted more protection from events that could undo years of saving.
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01-15-2015, 12:47 PM
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#17
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Recycles dryer sheets
Join Date: Nov 2014
Posts: 269
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01-15-2015, 12:56 PM
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#18
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Thinks s/he gets paid by the post
Join Date: Jan 2008
Posts: 1,644
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$5M umbrella. Was the most I could get without going to underwriting.
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01-15-2015, 01:33 PM
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#19
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2009
Posts: 6,679
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Back in 2010 I increased my auto insurance BI and PD limits from 100/200/25 to 250/500/50. Because I live in a large co-op apartment complex, I didn't feel I needed to buy umbrella because the co-op's large insurance policy acts like umbrella, covering potential claims against injuries or damages in the common areas of the co-op.
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Retired in late 2008 at age 45. Cashed in company stock, bought a lot of shares in a big bond fund and am living nicely off its dividends. IRA, SS, and a pension await me at age 60 and later. No kids, no debts.
"I want my money working for me instead of me working for my money!"
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01-15-2015, 01:39 PM
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#20
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Gone but not forgotten
Join Date: Jul 2012
Location: Peru
Posts: 6,335
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Next question is: do you know what the umbrella policy actually covers? Therein may be the reason that the coverage rate is so low. Just sayin'
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