An umbrella policy: how it will help you pay less for superior car insurance

Buy an umbrella policy and reduce your bodily injury liability coverage to the minimum required by law. The more substantial your asset, the truer this recommendation is for you.

What do you buy bodily injury liability coverage for? It is to take care of the passengers involved in an accident together with the other driver. If you don’t have coverage like this, your assets could be used to compensate accident victims.

However, you are urged to opt for an umbrella policy because even the most extensive liability coverage within an auto insurance policy would not be adequate if you are at fault in a fatal accident. This means that your personal assets will be liable if your liability coverage cannot handle the resulting bills and damages incurred.

But if you have an umbrella policy, you’re pretty sure it can handle the most extreme case. Plus, not only do you save on car insurance, but you also have coverage that takes care of any other type of liability issue that may arise in your life.

Price-wise, you get much more coverage per premium dollar with an umbrella policy…

If a 35 year old man living in New York City wants to increase his bodily injury to $100,000/$300,000 from $25,000/$50,000, his rate will increase by $300! However, with an umbrella policy, he’ll spend less than that to get $1 million worth of coverage.

And if you choose to increase your blanket policy coverage amount to $2 million, you’ll only have to pay $75 more. After the $2 million mark, you only need to add $50 to your rate for each additional coverage amount of $1 million. If you want more for less, an umbrella policy will do you more good.

Now, go ahead and reduce your liability coverage to the bare minimum. But make sure your general policy is in force before doing so.