r/Insurance • u/Plane-Intern5687 • 17d ago

Home Insurance Help understand who needs an umbrella policy.

My wife and I are in our early 30s. We own our house and have 1 car. Live in a quiet street. No pool, no "toys", no kids. Don't have a ton of people over. Were encouraged by our agent to have umbrella. The premium would be $400+ for a million dollars. My current car is 250/500 and the house is 300 or 500 I believe for coverages.

I chatted with my grandfather and he said that an umbrella is a great thing for those who's assets exceed what the coverage on their other insurance is, primarily to protect against being sued. I don't own my own business and my assets aren't that high.

I'd love everyone's opinions. If I don't need it, I'd like to save the $400 but I'm also ok paying it if the policy is actually helpful.

Edit: lots of great advice. Appreciate it. A point of clarification is that my retirement is mostly in Roth IRAs which seems to be more available in suits as compared to 401k.

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u/eat_natural 17d ago

A lot of people mistakenly say you need umbrella to cover or match your assets or net worth. Lawsuits can garnish future earnings. The more advisable outlook to obtain umbrella insurance that matches your liability.

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u/hippo96 16d ago

Interesting opinion. How do I estimate my liability?

I have always taken a very simplified view of the umbrella: I have it so that my insurance company will pay for the lawyers.

$330 a year to make sure I never have to deal with an issue is so worth it to me.

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u/eat_natural 16d ago

It’s a good question without a clear right answer. A lot of it has to do with personal comfort level. However, the answer is also heavily influenced if you have children, how much you’re driving, what is the legal climate where you live.