The Protection You Need When Things Probably Can’t Get Worse

Mar 11, 2020, 3:26 PM

What is umbrella coverage and why do you need it?

An umbrella policy is what you probably think it is — insurance coverage for a rainy day. This doesn’t mean insurance protection from storms, though we offer that too. In this case, a “rainy day” is an incident that costs more than your insurance normally covers.

On our information page and on the related PDF, we describe it this way: Umbrella coverage is excess over and above what you ordinarily have and is for the times you need an especially significant amount.

An Expensive Crash

When would that come in handy? Let’s look at an example.

You’re driving home from the grocery store and crash into another vehicle. It’s a major accident that will cost you $750,000. You have Hastings Mutual Personal Auto insurance for $500,000. That covers most of the expense, but there’s another $250,000 left to pay. Without an umbrella insurance policy, you’ll have to pay that $250,000 yourself. With a Hastings Mutual Umbrella policy, you won’t have to pay out of pocket.

Umbrella insurance for a car crash

A car accident is the classic situation, and it’s the one we briefly discuss on our information page. If you’re in Michigan, it’s probably especially thought-provoking now as the state prepares to put its no-fault reform auto insurance rules in place this July.

How much coverage should I have?

Our personal umbrella coverage can cover a lot — we offer options of $1 million to $5 million. Talk with your local independent insurance agent to find the amount that’s appropriate for your situation.

Our car crash example is for a personal policy (since it was you driving your own car on your own time), but umbrella coverage is available for business, personal, and farm policies since accidents can happen anywhere. We cover many different kinds of vehicles in most situations, including but not limited to:

  • Cars
  • Motorcycles
  • Recreational Vehicles like snowmobiles and all-terrain vehicles
  • Watercraft (boats and personal watercraft)

  • Umbrella coverage complements your other Hastings Mutual insurance — since it goes “above” your regular insurance, you’ll need to have a good Hastings Mutual business, personal, or farm policy in place before including this additional coverage.

    Is umbrella insurance right for you? It depends on what you need covered, and how comfortable you are with risk. Your local independent insurance agent can help you determine the coverage that’s right for you.

    Questions? Let us know in the comments.

    The Mutual Understanding blog and Hastings Mutual videos are made available for educational purposes only. The information referred to is not an official company statement, corporate policy, or offer of coverage. Refer to your insurance policy for specific coverage. There is no representation as to the accuracy or completeness of any information found by following any link on this site. Please contact your local independent insurance agent with further questions and for more details on any insurance policy-related information you read here.

    © 2020 Hastings Mutual Insurance Company. All rights reserved.

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