Debating this again. I don’t have a pool, or a 4 wheeler, or a trampoline, or a boat, or a mean dog…I’m rather boring, I suppose.

I do have a son that will be driving soon.

My current liability limits for the vehicles and house are pretty high, but will have to be bumped up a notch to get umbrella. It comes out to around $50/month when you count that in. $600 a year for $3 million. Which brings me to having no idea how much I’d need, $1-5 million.

My parents had/have it, but they own hundreds of acres outright, and have/had all that fun stuff I mentioned above. I own (or the bank does) my house on a tiny plot.

Side note…just realized how lame I am compared to my parents. But I struck out on my own and did it My Way. For better or worse.

Its all about transferring the financial liability to others. How much can you lose and still owe more to somebody in the event of a lawsuit gone bad ? Shop around, my umbrella is 2mm on top of the max limits on my cars and it’s not even $400 a year. I’m 100% with USAA. Hurt somebody bad in an accident and the bills can get sky high in a minute. I want somebody else’s lawyers and checkbook on the hook not me to be fighting and writing the checks.

Edited to add I see you said $600 for 3mm. That seems reasonable

I have the atvs, a trampoline, a boat, and a dog. I don't have a pool. I'm also engaged in a somewhat risky business and carry a firearm.

My umbrella covers all of that (including self defense). I'd have to look, but I'm pretty sure what I'm paying is considerably less than what you were quoted. Mine is through State Farm.

Full disclosure. I worked in Risk Management at a major carrier. Sat in on hundreds of "large loss" discussions. Where the carrier is sorting out how they wanted to handle the claim.
I want my carrier to have significant skin in the game should I ever be involved in a nasty claim against me. Also saw how the legal system gets worked to get a number of claimants into a case.
To answer your question I settled in at 4 million. If available consider some on un\under insured as well. I've found it's not available in all states.

My car is at 250/500 liability and I have 1M umbrella. For $200-ish a year it's a no brainer.

If you are at fault in an accident that cripples someone, you are going to be paying a lot of money.

If you own property or other assets and a court orders a settlement that exceeds your insurance coverage, your property is at risk of being taken to pay the settlement. Also the umbrella policy we have covers our family's medical claims in case we are hit by someone without adequate insurance to provide for our injuries.

I also have dash cams in all of our vehicles.

It really comes down to what assets are you trying to protect. If you don’t have a pot to piss in or a window to throw it out, you don’t need much insurance at all for a potential claimant to decide, “Shoot, I’ll take the pathetically low policy limit rather than sue this guy ‘cause lord knows you can’t get blood out of a turnip.” On the other hand, if you have ten million dollars of liquid assets in a brokerage account and $200,000 (two hundred thousand) policy limit insurance, a potential claimant made decide, “Heck no, I am not signing off for that paltry 200K, I’m going to sue this guy for everything he’s got.”

A few things to consider:

If you live in a really nice house but have no equity, even though there is nothing there, a potential claimant may not believe that.

Your circumstances may change and require a change in insurance. If your parents pass and you inherit all those acres, more coverage will likely be in order.

At best, avoid a situation giving rise to liability. As a backup plan, have enough coverage so that a potential claimant is better off taking policy limits (and signing the release to get that check) than going after you instead of accepting the settlement.

Wrt your son driving, when the time comes to have his own car, it is far better that it be in his own name and that he have his own separate insurance policy. Then you don’t have liability if something happens while he’s driving. Of course, this isn’t an option ‘til he’s 18, but something to consider for the future.

ETA: Not lame at all if you did it on your own and did it your way. There is some work and skill that goes into accumulating wealth, but there is a non-negligible slice of luck in there too.

The wife and I have a 1m umbrella. I think it adds about $125 a year. 1m is a pretty decent amount and I think it would cover us fairly well. Playing the odds in favor of never having to use it versus paying a higher premium for more coverage.

I have a pool and the Town of Gilbert says that as long as I have either a child proof fence around the pool or a fenced yard with a locked gate I'm blameless if someone comes over the fence and drowns.

Even my insurance company said it was no big deal as long as my gate was locked and they insured me for however much it was without adding a premium because of my pool.

Simply look around at the cost of a handful of cars your son will be driving amongst.

I have an in-ground pool, fenced.
I heard a lawyer say if someone hops the fence and drowns I can still be liable. If you out up a sign and they disregard it, then Im totally covered. I do have a million umbrella policy.

I have a couple of properties that I rent part time. I definitely feel the need for my umbrella policy. In fact, I was thinking of increasing it.

Chongo we have several homes, a pool, live on a lake with a boat have a few rental properties yada yada yada …

Last year we decided to do a full review of all our insurance policies and the net result was that we upped our umbrella policy to $2mil. I think it cost us right around $375-400 a year bundled with several other policies.

I think you are both over paying and getting more coverage than you probably need. Shop around.

Figure out you net worth and make it higher than that but not by millions.
Remember, you don’t need to outrun the bear, just your friend. Same concept.

If you don't have a pot to piss in, you don't need an umbrella policy.

If you have a net worth of a million dollars, you probably need an umbrella policy worth 1 million dollars.

quote:

Originally posted by smlsig:

I think you are both over paying and getting more coverage than you probably need. Shop around.

Unless I'm misunderstanding that the $600 is for all the insurance coverages, $600 for an umbrella policy does seem too high. I'm paying $13.50 a month for $1 million.

How much umbrella coverage you need is likened to how much moat protection you want to protect your "castle," that is, your assets.

You have to gauge how "stupid" or unlucky you are to be exposed to a liability suit. I think you're a cop and if qualified immunity is dropped, you'd be a lot more exposed than the average person.

You don't need coverage equal to all your assets. $1 million is a nice minimum to ensure your insurance company will fight before they give up. If you have $2 million in assets, I think $1 million is enough. Your insurance company will have to lose the suit, pay out the $1 million before they can come after your assets.

If I had $10 million in assets and assuming I'm not a monumental fuck up or unlucky, I think $3 million coverage should be more than enough.

I have one equal to my roughly twice my net worth. I won’t publicly disclose the amount. I feel it’s needed in todays litigious world. Every billboard I see is for some ambulance chasing lawyer. “Been Injured? Call Asshole and ButtCrack”

Something to keep in mind. The jump from $1 million to say $4 million isn't 4 times as much. Each level gets cheaper because the insurance company recognizes that the probability of the larger claims goes down.

No brainer. You need it. With a young son about to start driving I suggest 2MM for starters.

Its necessary if you own anything. YOU are really buying someone to defend you. Its not the case you lose that matters so much but the defense of the case in which you are right. In today's world the minimum anyone should have IMO is in the 2-3M range and it should go up from there if your assets are meaningful. I would never have less than my assets. I would have more than my assets if I was in the low part of the insurable range and its really a PIA to start your life completely over. This insurance is as cheap as you can buy and you should get coverage.