Why You Should Consider An Umbrella Policy

Written by Kristen Juracek, CISR

Hello again, does everyone have their cup of coffee before we dive into our next episode of Koffee with Kristen?! If not, I’m a patient person go brew that perfect cup and take a seat.

Umbrella/Excess Liability Policies

First thing you need to know is that an umbrella or excess liability is an additional layer of liability that provides protection beyond your existing liability limits of your other insurance policies. A little confusing, I know, but maybe this will help…

Now that you have a better understanding of what an umbrella/excess policy is I want to explain the difference between the two of them. A “true umbrella” policy covers everything you have even if you don’t have it listed.

You know I love my examples…

You have a house and two cars that are listed on the umbrella policy but over the weekend you buy a boat and decide to insure it with Flo but haven’t been able to let your agent know yet, that’s ok if you have a true umbrella because if a liability suit should arise from an accident with the boat your umbrella would still cover you after your Flo policy’s limits have been exhausted. If you have an “excess liability” that means everything must be listed on the policy to receive coverage from it. So, in this case the excess policy would not cover your boat since it has not been listed yet.


I bet you’re asking why an umbrella is even important to you?! With the change in Michigan law, you can now buy down on your personal injury protection (PIP) and you can now sue for medical expenses, before you could only sue for “pain and suffering”, so if the person you had an accident with has substantial injuries and choose to buy down then you could be on the hook for damages.

You may think you don’t have much but if you have to pay up, they can come after your retirement funds, college funds and even future wages. No one can tell you that you have to purchase an umbrella, but most $1,000,000 policies start at just $12.00 a month.


You should consider having a conversation with your agent to give you an umbrella analysis, the more risk you have increase the chances of an umbrella policy coming into play. I know it’s a lot and I could give you so many examples but I’m sure your cups are almost empty now. Please talk to your agent sometimes it just starts with a question.

Thank you all for enjoying your coffee with me.