A personal liability policy that provides an extra layer of coverage beyond the limits of your homeowners, auto, or other underlying policies. Umbrella policies typically start at $1 million in additional coverage and protect against large lawsuits and claims that could threaten your savings and assets.
Related Terms
Coverage Limit
The maximum amount an insurance company will pay for a covered loss under a policy. Limits can apply per occurrence, per person, or as an aggregate over the policy period. Choosing the right coverage limit is one of the most important decisions when buying insurance.
Liability Coverage
Insurance that pays for bodily injury and property damage you cause to others. In auto insurance, liability coverage is required in almost every state. It does not cover your own injuries or vehicle damage — you need collision and comprehensive coverage for that.
Excess Liability
Insurance that provides additional coverage above the limits of an underlying liability policy. Similar to umbrella insurance but narrower in scope — excess liability follows the same terms and conditions as the underlying policy rather than broadening coverage.