Question about umbrella policy and adult children living at home

Sunset said:
Blood is thicker than water.

Insurer's know people will lie for family.

I would guess you are not charging the kids rent, but you would charge a stranger rent to live there.
So charge them a fee to pay for the increased cost of the insurance.
If you don't want to charge the kids a fee, it proves blood is thicker than water, and they are not treated like strangers.
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You're right about all but the lying part. I can't imagine a scenario where I would lie for them, but perhaps I haven't imagined hard enough.

I could charge them a fee for their increase in my umbrella policy, but I won't for the same reasons I don't charge them rent. I don't need the money, and I'd rather see them use their income to further their house buying and business building and preparation to become a music teacher. And I don't want to nickel-and-dime my kids: "OK, Fred, you drove 143 miles last month so your prorated portion of the umbrella policy is $14.27. Please venmo me by Thursday." Adulting well is taking up most if not all of their bandwidth at the moment and getting a bill from Dad the retired guy doesn't seem right.
 
SecondCor521 said:
Thanks everyone for the replies so far.



Sure, I understand that.

I guess my POV would be that if my adult child caused damages in excess of their liability limits and my DNA and address is enough to get me named as a defendant, then I can hire a lawyer myself to get myself removed from the suit and pay out of pocket.

Just because I have an insurance policy with USAA doesn't mean I have to use it. It's not like they're going to butt into my legal affairs. I'd be fine if USAA just declined my claim in this circumstance.

Unless somehow the parent of the injured child could sue USAA as well. That seems a stretch, but maybe it happens.
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I don't think it's that simple . In fact over the years we've wondered if not having an umbrella would keep lawsuit troubles away from our doors. Most things don't go to court, it's back and forth between insurance companies and lawyers. It's literally the least transparent transaction possible probably deliberately. Beyond frustrating. To be clear we have never been sued
 
If you will read the definition of an insured in the early pages of your policy you will see that your children are covered under your policy as being blood relatives living in your home. Therefore your umbrella would also respond if they were involved in an accident and you were sued. A plaintiff's attorney will also go after their personal auto policies and try to stack the limits to try to get more money. Their coverage under your policy comes in the definitions of an "insured".
 
So far most of the discussion has been about my insurance company and their insurance policy.

What I'm more interested in is the legal theory if anyone knows. Let's say my kid drives his car over a kindergartner who was going to become the next CEO of IBM. The family sues my kid, me, my neighbors, the company that manufactured my kid's car, my insurance company, my local library, and our state governor.

On what legal grounds is anyone but my son liable for his negligent action? In particular, me? Does anyone know that part of the equation?

ETA: I just reviewed my premium and it isn't that bad, with one of my three kids on there. USAA is trying to get the others added, I think mostly to cover any donut hole between the max of their liability coverage (say 100/300) and what USAA recommends (probably 300/500) to meet the deductible for the umbrella.

So I'm still curious, but now not as concerned.
 
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SecondCor521 said:
So far most of the discussion has been about my insurance company and their insurance policy.

What I'm more interested in is the legal theory if anyone knows. Let's say my kid drives his car over a kindergartner who was going to become the next CEO of IBM. The family sues my kid, me, my neighbors, the company that manufactured my kid's car, my insurance company, my local library, and our state governor.

On what legal grounds is anyone but my son liable for his negligent action? In particular, me? Does anyone know that part of the equation?

ETA: I just reviewed my premium and it isn't that bad, with one of my three kids on there. USAA is trying to get the others added, I think mostly to cover any donut hole between the max of their liability coverage (say 100/300) and what USAA recommends (probably 300/500) to meet the deductible for the umbrella.

So I'm still curious, but now not as concerned.
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Nolo has this to say, "Parents and guardians generally won't be liable for their teen driver once the child reaches the age of majority (18 years) and the vehicle is legally owned by the child (it's titled in the child's name)." https://www.nolo.com/legal-encyclopedia/am-i-liable-if-my-teen-driver-causes-a-car-accident.html
 
SecCor...every circumstance is going to be different..you're at one extreme and the insurance company is at another...I guess you need to make a choice since the insurance company won't be changing their rules...you've certainly been around enough to know suing people has turned into a national pastime.
 
I am surprised because when I owned a house and had my adult kids moved back in I never was contacted by the insurance company that I had my umbrella coverage. My kids all had their own car insurance and never drove my car.
 
Teacher Terry said:
I am surprised because when I owned a house and had my adult kids moved back in I never was contacted by the insurance company that I had my umbrella coverage. My kids all had their own car insurance and never drove my car.
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How would they know...every couple years we have to review our policies and make changes..
 
ivinsfan said:
How would they know...every couple years we have to review our policies and make changes..
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Right. In my case I think USAA triggered on the event when my eldest son bought his car and set up his own auto policy with USAA. He and I are logically connected in their system because he has membership there through me. And he is also living at my address.

I don't know what the triggering event was for asking about the other two, although they are both USAA members also and the middle one has his car insurance with them too.

:shrug:
 
Agree with the shrug...our umbrella would vary in cost by the amount of acres we farmed and what townships they were in. No extra people no more machinery.
 
We have not had our adult son who was living in our home on our auto or umbrella coverage

We are using National General Insurance in Illinois
and we had another insurance company as well (changed for $$ one year)

Son had own vehicle we gifted to him, title changed just to his name and his own insurance/ I think he used progressive insurance

We go through an insurance broker - have them check multiple companies & options each year to decide who to use.

I think it might be dependent on insurance company (and perhaps state?). Perhaps check with an independent insurance broker for options
 
When my son started driving we took out an umbrella policy. After he got married and moved out, we put a pool in and decided to keep the policy in case something were to happen at the pool.
 
I was an insurance agent for over 30 years.

My clients would balk most every time I told the that they should have higher limits of liability insurance.

I had more than a few clients waiting for me outside my office before we were even open at 7:00 am waiting for me to open my office sweating blood, with a subpeana in their hands and had them throw it at me and tell me "If I dont have enough insurance I'll sue you for everything for your house and everything you own and everything you'll ever make!!! This happened to me many times. Each time they were covered adequately and I still own my house (and everything I made). Because I insisted that they carry adequate limits of insurance ahead of time.

To the insurance agent trying to help you out. An agent grosses about 8% on an umbrella policy. You bet they're trying to hose you out of another $100 of premium or so to make $8. There are easier ways to add $8 to your commission gross schedule. A good PC agent is trying to help you out and use their experience to help you. I've never met a PC agent who tried to have a client take out more coverage than they actually needed. Most people are underinsured for their property and liability exposures and will blame their agent when they come up short. They won't blame themselves....

If you don't have enough liability insurance to cover your net worth....its your own fault if you lose it.

A good friend of mine was an attorney and defended many liability claims for the companies he represented. He said it wasn't uncommon at all to get judgements over the limits of insurance. An "excess verdict" He said the courts don't care how much insurance you have, they don't even know. Its how many assets you have and the victim will get them if you are liable.

If you think that if you don't carry more insurance that they won't sue you for more you're mistaken. I heard many people say "the more insurance you have the more they'll sue you for". No. The more assets you have the more they'll sue you for. The insurance company is just in the way.

The best example I told my clients was this. "If someone injured you or your family......how much would you sue them for? Their answer was never "I'd settle for their $100,000 liability insurance limits and I'd be happy!" "If they had more insurance I'd sue them for more...even though they have millions of dollars more than they have insurance for. I'll settle for how much liability insurance they have, even if my expenses are more, that's all I can get."

If you had a $1,000,000 claim and the other guy that hurt you had $100,000 of liability insurance..... and he had a couple million dollars of assets. Would you accept a judgement of $100,000 because that his how much insurance they carried ? If your children hurt someone and got sued I bet you'd be disappointed if you weren't covered for the judgement (or defense) if you got drug in (and you will).

If your kids are in your house and your insurer makes you cover them, they're protecting all of you. If something happened and you weren't covered it would be bad for everyone. And you'd ask why you weren't covered for this?.
 
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The posters here with adult children at home aren't saying we don't want umbrella liability insurance, just that why should we have to pay double for an adult in our house who shares our DNA, but not if we had a friend or unrelated renter living in the same house. Is DNA a valid reason for legal liability when the other person is an adult with their own car and policy? What if it was a niece or cousin, or parent?
 
daylatedollarshort said:
The posters here with adult children at home aren't saying we don't want umbrella liability insurance, just that why should we have to pay double for an adult in our house who shares our DNA, but not if we had a friend or unrelated renter living in the same house. Is DNA a valid reason for legal liability when the other person is an adult with their own car and policy? What if it was a niece or cousin, or parent?
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Read the definition of an "insured" and who the insurer is obligated to defend. It's not your insurer that intends to insure people not rated on the policy, its the plaintiff. There are bullet proof court tested exclusions why the insurance doesn't apply to unrelated renters or friends in your household. Family members in your household can get drug in as "insureds" even if it is nobody's intent. Sorry. Don't blame your inurer, blame the creative plaintiff attorneys.
 
In my view, this is one of those cases where "innocent" is not enough, you have to prove you are "above suspicion". There is enough history of adult kids living with their parents causing liability that the insurance company does not want to take any chances. Note how many interviews of parents, whose children have done crimes, always say "my kid's a good kid at heart". The insurers just do not want to take that chance.
 
I am no attorney but here are ansers:
1. Related people are more likely to share vehicles than strangers living with you.
2. Whether you like it or not, you have to abide by *all* requirements of an insurance company. Violating anything would be as good as having a no policy. It is a cheap insurance, pun intended.
 
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When my adult sons have lived at home we don’t ever drive each other’s cars under any circumstances since we all have our separate insurance for the vehicles. They are always different companies so it’s never been a problem.
 
Teacher Terry said:
When my adult sons have lived at home we don’t ever drive each other’s cars under any circumstances since we all have our separate insurance for the vehicles. They are always different companies so it’s never been a problem.
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I hear you but ignorance is not a valid defense.


https://www.lopriore.com/blog/who-is-included-in-umbrella-policy-coverage/
"However, those in your household who have their own insurance policies may not be included. For instance, an adult child with their own auto policy may want their own umbrella policy as well."
 
Teacher Terry said:
When my adult sons have lived at home we don’t ever drive each other’s cars under any circumstances since we all have our separate insurance for the vehicles. They are always different companies so it’s never been a problem.
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It would have been if they'd known. Years ago I had a friend who couldn't get insurance through regular channels because her husband had a terrible driving record. He was in the household so he was an exposure. There's always the possibility that another household member (related or unrelated) will drive your car because theirs is in the shop, theirs wouldn't start and they needed to get to work, etc.

Frankly, I'm surprised that an unrelated member of the household wouldn't have to be on the umbrella policy.
 
pjigar said:
I hear you but ignorance is not a valid defense.


https://www.lopriore.com/blog/who-is-included-in-umbrella-policy-coverage/
"However, those in your household who have their own insurance policies may not be included. For instance, an adult child with their own auto policy may want their own umbrella policy as well."
Click to expand...


We have a friend who is an attorney and they took their college kid off their umbrella policy because the kid had no assets. If they got sued, what is there to collect except maybe some hoodies and an old Iphone with a cracked screen? The kid was living at school at the time, if I remember right, but home for summers and vacations.
 
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This is a useful thread. Our adult son lives with us, has his own car and own auto insurance. We’ll definitely have him look into umbrella insurance.

When cars are in the shop, we sometimes drive his and he sometimes drives ours. Sometimes he needs our van to move percussion equipment.

We’re not kicking him out. It’s very handy having an extra adult in the home. He is a conscientious driver, no drinking, no drugs.
 
I didn’t have my adult kids under my umbrella policy so maybe that’s the difference. When my kids were teenagers we took my aunt’s advice and bought them all their own separate policies for the one car that they could drive. That way if they weren’t good drivers they wouldn’t negatively affect our rates.

It was always understood that if their car wasn’t working they weren’t insured under our cars and couldn’t touch them for any reason not even an emergency. It was never an issue with any of the 3 boys ever. If they had violated the rules they knew that they would have been done driving until old enough to buy their own car and insurance. They knew that their dad was serious and no second chances on something so serious.
 
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