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California Umbrella Insurance
Life in California is full of surprises — some good, some unexpected. That’s why it’s always a good idea to have an additional layer of protection for those “just in case” moments. That’s where umbrella insurance comes into play. It acts as a safety net when your standard auto or home insurance reaches its limits.
Whether you’re cruising along the Pacific Coast Highway or hosting a backyard barbecue, umbrella insurance provides that extra cushion to help protect your finances and peace of mind when life throws the unexpected your way.
What Does Umbrella Insurance Cover in California?
Umbrella insurance helps cover the costs of liability claims when you max out the limits of your current homeowners or auto insurance policies. Here’s what it typically covers:
- Bodily injury claims: If someone is injured in a car accident or while visiting your property, and the medical bills go beyond what your standard insurance covers, umbrella insurance can help pay these costs.
- Property damage claims: Accidents happen, and if they lead to costly damage to someone else’s property — whether it’s their home, car, or belongings — this policy helps protect you.
- Legal defense costs: Lawsuits can get expensive fast. Umbrella insurance may cover your legal defense costs, whether it’s a defamation case or an injury lawsuit.
- Libel, slander, or defamation lawsuits: Protect yourself from the cost of defending against these personal injury claims, which standard policies may not cover.
- Rental property liability: If you own a rental property, umbrella insurance may provide extra protection beyond your landlord insurance. It helps in case of accidents or liability claims involving your tenants or the property itself.
What Does Umbrella Insurance Not Cover?
While umbrella insurance offers extensive protection, it’s not a catch-all policy. Here are a few things it won’t cover:
- Personal injuries: It won’t cover your own medical bills if you’re injured in an accident.
- Intentional damage: If you’re found to have caused harm or damage intentionally, umbrella insurance won’t help.
- Business liabilities: Umbrella insurance won’t cover business-related incidents. If you run a business, you may need a commercial umbrella policy or professional liability insurance.
- Damage to your own property: It doesn’t protect your personal property. That’s still covered by your home or renters insurance.
- Written or oral contracts: Umbrella insurance doesn’t cover any liability arising from breaches of written or oral agreements, such as contract disputes or missed obligations.
Who Should Consider Umbrella Insurance in California?
Here are some common scenarios in California where having umbrella insurance could be a smart move:
Traffic Accidents
California’s roads are some of the busiest in the nation, and with that comes a higher risk of accidents. If you’re involved in a multi-car collision or cause serious damage in an accident, your auto insurance might not be enough to cover all the medical bills or property damage.
Home Accidents
Hosting parties, owning a pool, or simply having visitors at your home can open you up to potential liability claims. If someone is injured on your property and sues you, the medical bills and legal fees could quickly exceed your homeowners insurance.
Rental Property Owners
If you own rental properties in California, tenants and guests could get injured on your property, or you could face liability issues related to accidents. Umbrella insurance can be a lifesaver by providing an extra layer of protection beyond what your landlord insurance offers.
High Net Worth Individuals
If you have substantial assets — like multiple properties, investments, or savings — umbrella insurance is a must-have. It protects your wealth from large liability claims that exceed the limits of your other insurance policies.
Outdoor Enthusiasts and Pet Owners
If you love outdoor activities, like boating or ATV riding, or if you own pets, you could face additional liability risks. For example, if your dog bites someone or you’re involved in an accident while boating, umbrella insurance can help cover the related claims or lawsuits.
How to Get Umbrella Insurance in California
Ready to boost your protection? Mercury has you covered. Getting started with umbrella insurance in California is easy. Simply contact a California insurance agent, and they’ll help you customize the right policy for your needs. You can also get a quote online in just minutes or call (888) 662-4519.
What’s the Cost of Umbrella Insurance in California?
The cost varies based on factors like the level of coverage you choose and the underlying policies it supports. However, according to Forbes, the average cost of umbrella insurance is $383 a year for $1 million in coverage. For the peace of mind that it provides, it’s a small price to pay for that extra security.
How Umbrella Insurance Works with Existing Policies
Umbrella insurance isn’t a standalone policy. It works in conjunction with your existing auto, homeowners, or renters insurance, making it an extension of those policies. For example, if you’re involved in a serious car accident and your auto insurance covers up to $250,000 in liability, but the medical bills and damages total $500,000, your umbrella policy would cover the remaining $250,000. The same principle applies to other personal liability claims that surpass your home or renters insurance limits.
How Much Umbrella Insurance Do You Need in California?
The amount of umbrella insurance you need in California depends on your personal circumstances, including your assets, lifestyle, and potential risks. In general, coverage starts at $1 million, but some California residents opt for more, especially those with higher assets or who frequently entertain guests, drive long distances, or own multiple properties. It’s all about how much risk you’re comfortable with and the level of protection you want.
Contact a California insurance agent to discuss how coverage is best for you.
California Umbrella Insurance FAQS
What is the minimum coverage required for umbrella insurance in California?
Most insurance companies require you to have a minimum amount of auto and homeowners insurance before you can add umbrella coverage. Typically, this is around $250,000 for auto liability and $300,000 for homeowners liability.
Does umbrella insurance cover rental properties in California?
Yes, if you own rental properties in California, umbrella insurance can extend to cover liabilities related to your tenants and the property itself, providing extra protection beyond your landlord insurance.
How does umbrella insurance work with earthquake insurance?
If an earthquake leads to an accident or injury on your property — like a guest getting hurt due to quake-related damage — your umbrella insurance may cover liability claims that exceed the limits of your homeowners or earthquake insurance. However, it won’t help pay for the actual damage to your home.
Is umbrella insurance tax-deductible in California?
For most people, personal umbrella insurance isn’t tax-deductible because it’s considered a personal expense. But if you’re using the coverage to protect rental properties or a business, you might be able to deduct part of the premiums. It’s a good idea to check with a tax professional to see if any portion of your policy qualifies for a deduction based on your specific needs.
Is an umbrella policy worth it?
If you have substantial assets that go beyond your liability coverage limits or just want extra peace of mind, getting umbrella insurance can be a smart decision. Talk with an insurance agent today to see if adding umbrella insurance to your policy is the right fit for your needs.
Mercury Insurance Coverage in California
At Mercury, we offer more than just umbrella insurance. Explore our other coverage options in California to protect your home, car, and more: