What are the right Liability limits for my insurance policies?

If you are operating a car and earning an income, you need liability insurance.  We recommend at least $500,000 of bodily Injury.  In addition, you should consider purchasing a $1,000,000 Umbrella Liability policy.  While these limits are probably higher than what you are purchasing, I am sure you want to be protected in that rare event that you are sued.  If you are sued you will be forced to pay legal fees and any judgement awarded by the courts.  The legal judgement will be paid from your current assets and any future earnings.  And the courts will be used to ensure this debit is paid.

Most family’s exposures quickly increase as they progress through life.  First there is auto ownership, than you become a homeowner.  What’s next a swimming pool, a boat, a motorcycle or even a 16 year old child?  What could possibly go wrong?

An insurance policy is an inexpensive way to protect your present assets and future earning from a devastating lawsuit.  Most policies will pay your entire defense cost.  And these expenses add up quickly, even if you win your case.  Ask yourself, what does it cost to spend 5 days in intensive care?  Would $300,000 be enough for that 5 day hospital stay?  Would $500,000 cover the hospital stay, the recovery time away from work and mental anguish caused by your errors?  It’s entirely possible that your auto or home insurance policy does not provide enough liability protection.  Don’t leave your future earnings in jeopardy.

If you are earning an income, you need a $1,000,000 umbrella to protect your future earnings.  If you are earning over $100,000 per year, most financial analyst will recommend umbrella limit of over $1,000,000.  And although prices vary, most insurers sell an umbrella policy for about $200 per year.  This amount can be saved earning account credits when the same carrier writes all your policies. Or you can save this amount by increasing your property deductibles to $1,000.   Yes, you would suffer a $1,000 loss if your property suffers damage, but your future earnings would be protected from that legal judgement.

Call Walterry Insurance Brokers to discuss the liability protection.  Allow us to compare the insurance you have, and suggest what can be done to make sure you can live into retirement without having to pay that legal settlement award.