Umbrella Insurance

About Umbrella Insurance

Personal umbrella policies emerged in the 1940s when affluent households layered excess liability above auto and homeowners limits to protect growing wealth from catastrophic lawsuits.¹

ISO introduced standardized umbrella forms in the 1970s, codifying underlying limit requirements, self-insured retentions (SIRs), and drop-down coverage for exposures not addressed on primary policies.²

Fast forward to 2025: the Insurance Information Institute reports that jury awards over $10 million (“nuclear verdicts”) have increased 27% since 2019, and personal umbrellas are now mainstream for families with teenage drivers, rental properties, or significant assets in the New York tri-state area.³

Coverage Highlights

Umbrella policies add both height and breadth to your existing liability portfolio.

• Excess liability over auto, home, boat, and rental policies:  Provides $1 million to $10 million (or more) in additional limits once primary coverage is exhausted.¹
• Drop-down protection: Responds to certain exposures not covered by underlying policies after you satisfy the SIR, such as libel or false arrest claims.²
• Worldwide personal injury: Extends to libel, slander, or invasion-of-privacy incidents anywhere, protecting against social-media disputes and online reviews.³
• Defense costs outside the limit: Many umbrellas pay defense in addition to liability limits, preventing attorney fees from eroding your settlement capacity.⁴
• Excess UM/UIM: Adds extra uninsured/underinsured motorist protection for severe bodily injuries caused by underinsured drivers.⁵
• Rental property & recreational liability:  Extends coverage to owned rental units, boats, ATVs, and other exposures so every asset shares the same liability tower.⁶

Rising Costs

Bodily injury claim severity for personal auto jumped 11% in 2024, contributing to higher umbrella attachment points and rate filings.¹

The Insurance Information Institute observes that “nuclear verdicts” over $10 million have increased 27% since 2019, pushing carriers to raise umbrella premiums and underlying limit requirements.²

Youthful drivers and short-term rental exposures add volatility: The National Safety Council notes teen drivers are four times more likely to crash than adults, so umbrellas covering young drivers or Airbnb hosts are seeing surcharges (inference based on NSC crash data and carrier underwriting guidance).³

Cheaper Premiums

• Raise underlying limits: Having $500,000 auto and $500,000 homeowners liability often earns lower umbrella premiums because the umbrella attaches higher.¹
• Maintain clean driving records: Carriers surcharge umbrellas for major violations; defensive driving courses can help remove points and qualify for discounts.²
• Consolidate with one carrier: Bundling home, auto, and umbrella with a single insurer can save 10%-20% on the umbrella premium according to III.³
• Limit higher-risk exposures: Requiring renter's insurance from tenants, using professional property managers, and enforcing boating/ATV safety rules demonstrate risk control to underwriters.⁴
• Increase the umbrella self-insured retention:  Some carriers allow $10,000-$25,000 SIRs for non-auto claims, lowering premium if you can absorb smaller losses.⁵

What We Do

Umbrella insurance is becoming an essential layer of protection for families seeking to safeguard their assets and lifestyle against escalating costs liability risks. We understand the evolving landscape of personal liability and work closely with you to secure competitive umbrella policies specific to your needs.