Do you need to know about State Farm’s Umbrella Insurance? Perhaps you need to know if this coverage is right for you. Keep reading to find out what Personal Umbrella Insurance is and whether or not you need it.
This article will discuss what’s covered by Umbrella Insurance and how much a policy from State Farm may cost. Finally, we’ll discuss other options for a Personal Umbrella Insurance policy.
What is State Farm Umbrella Insurance?
State Farm Personal Umbrella Insurance is supplemental to Auto and Home Owners’ Insurance, specifically the liability portion of each policy. An umbrella policy is designed to cover liability above what the traditional policies cover.
Pro Tip: It’s always a good idea to consider whether you have enough coverage.
State Farm Umbrella Insurance starts with one million dollars in minimal additional coverage. Policies for more coverage are available in $1,000,000 increments.
To be eligible for an umbrella policy through State Farm, you must also have Auto Insurance and Homeowners’ Insurance with State Farm.
Pro Tip: State Farm often requires that your automobile insurance liability coverage be at least $250,000/$500,000 to be eligible for their umbrella coverage.
A State Farm agent will make sure that your auto insurance liability and homeowners’ limits meet the minimum requirements to add on an umbrella policy.
What Does State Farm Umbrella Insurance Cover?
State Farm Personal Umbrella Insurance covers liabilities over what is covered on a homeowner’s or auto policy. This Umbrella Insurance also covers personal claims.
Situations Covered By an Umbrella Policy
| Auto Liability | HomeOwners Liability | Personal Liability | Boat Liability |
Auto Liability
Umbrella insurance covers the extra liability that isn’t covered by your auto insurance. Every auto insurance policy has a per-claim limit. Having an extra umbrella policy will keep you protected in the case of major liability.
EXAMPLE: Let’s say your car has a major failure on a busy freeway. This causes an accident that impacts multiple cars, drivers, and passengers. Your regular policy doesn’t cover the full liability for the accident. In this case, your umbrella policy would supplement the auto insurance coverage up to the set limit for the umbrella policy.
Homeowners’ Liability
A homeowners’ liability claim could end up costing more than the limits provided on your homeowner’s policy. The umbrella policy would add supplemental coverage in this situation.
EXAMPLE: An electrical issue results in a fire on the exterior of your home. The fire quickly spreads to your neighbor’s yard and their house. As a result of the fire, your neighbor needs medical attention.
An umbrella policy will cover medical expenses and property damage that goes above the limits of the homeowners’ policy up to the limitation set by the umbrella policy.
Personal Liability
An umbrella policy will also cover personal claims against the policyholder for libel, slander, or defamation of character. This coverage may or may not be a part of your other policies. If it’s not included in your policies, consider an umbrella policy to protect you.
Boat Liability
For boat owners, an umbrella liability policy through State Farm will also supplement your boat liability insurance. Any claim above your boat liability limits will have coverage from the umbrella policy.
What Isn’t Covered by State Farm Umbrella Insurance?
State Farm’s umbrella policies don’t cover intentional or criminal damage. Umbrella policies also won’t cover personal injuries and personal property damage–like to your own home or vehicle. The umbrella insurance only covers liability.
Business liability isn’t covered by a personal policy. Make sure that you have the appropriate business coverage for professional use.
Cost of State Farm Umbrella Insurance
For a typical household with one home and two vehicles, an umbrella policy through State Farm will be about $120-$200 per year for $1,000,000 in supplemental coverage. More cars, homes, boats, or adding additional coverage will impact premiums.
Who Needs Umbrella Insurance?
Umbrella insurance is a wise choice for many policyholders because it can versatilely supplement coverage of other policies. The coverage will help protect your assets in the case of a lawsuit stemming from personal liability.
Some instances where liability insurance would be essential:
- Having young or inexperienced drivers on the auto insurance policy
- Most homeowners may want an umbrella policy for more coverage for bodily injury since injuries with lawsuits can easily become expensive
- Having a family pet that adds liability such as a dog or cat
- You are near retirement or have savings or assets to protect from claims
Other Options for Umbrella Coverage
Umbrella coverage is available through most insurance companies that offer Auto and Homeowners’ policies.
Some other popular companies that advertise Umbrella policies include
- USAA
- Geico
- Progressive
- Travelers Insurance
- The Hartford
- Farmers Insurance
- Liberty Mutual
- Allstate
Frequently Asked Questions
Is a personal umbrella insurance policy worth it?
Personal umbrella insurance policies financially protect you when being sued for liability. Liability may arise from auto, homeowners’, or personal claims. Frequently, claims may exceed the amount provided on auto and homeowners’ policies, and the umbrella policy is an affordable way to increase coverage.
Is personal umbrella insurance expensive?
Personal umbrella insurance can be found for as low as a dollar per day for a million dollars of additional coverage. This supplemental insurance can be an affordable way to protect yourself from large liability claims. Costs will vary by location and the number of cars or boats covered.
Can I get a standalone umbrella insurance policy?
Umbrella Insurance cannot be purchased as a standalone policy. Umbrella insurance is supplemental to auto and homeowner’s insurance policies. Boat owners will also need a boat policy to add a personal umbrella policy.
Resources
Geico (2023). Umbrella Insurance How It Works & What It Covers. Geico.com. Retrieved January 4, 2022, from https://www.geico.com/information/aboutinsurance/umbrella/
State Farm (2023). Personal Liability Umbrella Policy. StateFarm.com. Retrieved January 4, 2022, from https://www.statefarm.com/insurance/liability/personal-umbrella-policy
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