EPS 26 - Umbrella Insurance: Protecting More Than Just Your Home

Sometimes the biggest financial risks aren’t the ones you see coming. In this episode of the Pink Money Podcast, Jerry breaks down why an umbrella policy can be a smart, affordable way to protect your assets beyond the limits of your homeowners or auto insurance.

From dog bites at the neighborhood pool to trampolines, defamation claims, or even accidents that exhaust your standard liability limits, Jerry explains:

• When an umbrella policy kicks in — and why it matters if you have growing assets
• How much coverage typically costs (and why it’s cheaper than you think)
• Why insurers may require you to max out your auto/home limits first og bites, trampolines, and lawsuits—oh my. Jerry explains why an umbrella policy is one of the cheapest, smartest ways to protect your wealth beyond homeowners and auto coverage. 
• Real-world stories of renters, valuables, and unexpected liability claims

💡 Takeaway: If you have a lot to lose, you have a lot to protect. An umbrella policy may be one of the most overlooked but essential tools for safeguarding your financial future.

💬 Have a question or comment? Contact Jerry here

Transcript

UNKNOWN: 0:00

Bye.

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Hey, hello, hello,

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hello, and welcome to the Pink Money Podcast, where We talk about all things related to money from a gay perspective, and I'm your host, Jerry Williams. And, you know, I was in the financial services arena, you know, for a long, long time, over 20 some odd years, you know, had all kinds of licenses and certificates and, you know, education. You know, my master's is in personal financial planning. But, you know, really, when you see a financial advisor, often what they want to do is, you know, help you grow your wealth and protect what you have. And those two goals combined are kind of serves as a basis of really in terms of an analysis of what an advisor is going to do is really take a real structured look at your overall situation from the ground up. And when you're talking about, you know, growing your wealth, you know, there's all sorts of ways to do that. And that just depends, again, on what your financial goals are, chiefly, let's say, like retirement. So when you're talking about protect your wealth, then there's also all kinds of ways to do that. But as we know, there's all sorts of ways to lose your money, and for it to be taken from you, and or, you know, of course, you could give it away. So there's different strategies for all that. But recently, I was talking talking with someone who told me that their daughter had a friend who came over to their community pool and her friend brought her dog and her dog bit someone on the face ouch so I'm not too sure about all the circumstances regarding that. I don't know if the dog was on the leash, off the leash, whether they could have pets, they couldn't have pets, all the circumstances surrounding it. But what made me think is in that particular situation, I hope that the daughter's parents have an umbrella policy. And the reason I say that is because an umbrella policy will help kick in when the limits of your personal protection policy, like your homeowners, has been exhausted. So an umbrella policy is good because it provides protection that exceeds those limits on, let's say, your homeowners, whatever the liability is. So if you have a lot to lose, then you have a lot to protect, and therein, that's the reason for an umbrella policy. So an umbrella policy, typically you're going to buy it from the same insurance company that you have your homeowners and auto and that kind of stuff with. Some companies will make you have all your protection, like your homeowners and your auto, all under the same roof before they give you an umbrella policy. Some may not, just really depends, but here nor there. you really want to explore having an umbrella policy when your net worth is getting up there to half million, million beyond. So does that mean if I don't have a half million dollars of assets that I don't need one? No, that doesn't mean that. It just means that in general, you know, a lot of companies may just ask you what your net worth is. So they have a good idea of whether they're going to extend you an opportunity to buy one or not. Now, I've seen some umbrella policies that go down to like a half million dollars. Is it common? Probably not. But generally, a million is typically where they start. And sometimes then they go up in million dollar increments. But if you could buy one, let's say at a half million, I certainly would just like and a flood insurance policy. If you're in a flood-prone zone, you may or may not be required to buy one or have one, but certainly isn't it useful in today's world where flooding is becoming more and more commonplace? It certainly happens all over the place. We know what Florida's like. Anywhere on the coastal waters, again, it's a big problem. That aside, an umbrella policy, again, can be useful when you have something like an attractive nuisance on your property, meaning something that attracts young children who may not have the wherewithal and the experience to recognize that this is a dangerous, potentially dangerous situation. device like let's say a trampoline or a swimming pool it could also mean you know that you get sued for defamation it can be useful for that or slander but yet many times like i said in this circumstance where let's say your dog bites someone depending on the severity of this dog bite i could easily see you getting sued you know by those parents because of that dog bite so It's always a good idea, in my opinion, to carry one. They're relatively inexpensive. I would probably suspect you could get one, a million dollars, I would say, I don't know, from three to maybe 500 a year, just guessing. I don't really know what the prices are these days. It's been a long time since I sold one. But the point is that if you have a lot to lose, you have a lot to protect, and you really want to explore getting an umbrella policy, Just like if you have a lot of valuable jewelry and, you know, things like your bullion, your gold, et cetera, you know, then it's a really good idea to carry a ride-along jewelry insurance policy. Because if you own expensive watches, you have a really expensive... engagement ring or wedding ring or what have you those can easily get lost right they can easily easily be misplaced it can go down the drain you drop it in the swimming pool on and on and on and on and on so it's a really good idea to insure those things because once you lose them they're very expensive to replace and the insurance can definitely be helpful in that circumstance so For a little bit of money, you get a lot of coverage, and if and when it's needed, it's very helpful. I mean, I know that I lost my original college ring, and when I bought it, I just so happened to take out the insurance policy that ran along with it. So it was several years later when I finally decided, you know, I probably should replace that thing. Even though I don't wear it very much, but it's nice to have, you know, all that. My mom was always asking me, why don't you wear your ring? And I'm like, oh, well, you know, I lost it. Anyway, come to find out, when I called, it was very nearly set to expire. And I was able to get my gold ring replaced for only$500. Really, really cheap. And then the girl told me even after that, she said, we don't even sell this anymore. So, hey, it just happened to work out for me. But in that circumstance, again, insurance is really nice to have when it's really useful and you need it to fall back on. Just like you carry insurance for your automobile, the liability, right? If you get into some, God forbid, horrible situation and, again, the injuries that you caused exceeded your auto insurance policy, your umbrella policy will kick in. So So... It's a really good idea to carry one, in my opinion, and have one that is at least, let's say, a million dollars. But again, that depends on your net worth and it depends on your circumstances and what the insurance company will actually cover you for. And most likely, they're going to start asking you questions about why you want one, what kind of things are on your property that might be problematic. You know, do you have a sandpit? Do you have old vehicles on your... property? Do you run some type of business? Do you, you know, have a swing set that's unprotected? Who knows, right? There can be all sorts of situations. I know when I was a kid, we had some neighbors several doors down that had a trampoline that they put in their swimming pool when it was empty. And we went over there all the time and jumped. And I can't tell you the number of kids that got injured when they bounced off that thing and then bounced onto the concrete. It just happened. I don't remember anyone getting sued, but those were way back in the days. Now today, you'd probably stub your toe and get sued. It's just those kind of situations you hear about these days. Anyway, I think that an umbrella policy, like I said, is a really good reason to have one. There's all sorts of circumstances that could warrant it. And when you're going to buy one, Then that's also probably the same. At the same time, the insurance company will probably look at your overall policy with you, your policies with you, your auto insurance, your homeowners. If you have renters, right, you should carry renters insurance because I can't tell you how many circumstances where renters really need a renters policy. I'm even going to throw this out too. I remember when years and years ago I was living in an apartment. I came home one day and the door was busted in. And I walked in, took a look around. I saw all kinds of things pulled out from all the shelves and closets. And it was a complete mess. I called the police. They came over. They took a look around. They took reports. They took... you know, fingerprints, etc, all that good stuff. In fact, I remember one cop asking me, he said, you know, do you happen to have any serial numbers for your stereo equipment and things that were took? And I said, Yeah, you know, I do. And, you know, at that time, I remember when I don't even know if they do this anymore. But if you buy at the time, you would buy your electronic equipment, let's say your stereo receiver. And usually there was a like a card came with it, and the card would have, like, mail this in registration that contained the serial number on it. Something I didn't do at that time, but I had intended to do it, and I had slipped all those cards underneath the electronics with the intention of, hey, you know, at least I know where they are when I get ready to do it. Well, lo and behold, I never did it. The unit got stolen, and there, laying on the table, was the registration cards with the serial numbers on them. So it was incredibly lucky for me. And then I remember when the detective gave me a call one time and he said, hey, you know what? We found your VCR. I said, oh, really? Where was it? He said it was at a pawn shop. He said, by the way, do you have anybody in your family who's a midget? I don't even know if that's the right word to use anymore. So I apologize if that's not the right word. Short person, I guess maybe it is. I'm not sure. Sorry. But anyway, I said, no, I don't. I have an uncle who's a jockey. That's about the closest. I think my mom's only five feet tall. But anyway, I said, no. I said, why? He said, that's the person who was ponying it, and you just happen to have the same last name as you. I was kind of floored, and that was funny. Never got that back. I don't even know what happened to the guy either. But hey, you know, c'est la vie. Nevertheless... It's just a good idea to carry the right amount of insurance for the right reasons. And usually, again, when your underlying policies are reviewed, they're going to make you max them out to the fullest extent before they kick in that umbrella policy because it's going to dovetail off of those two, your auto and your homeowners. And that just, again, depends whatever the liability ends up being. So that's... pretty much it for me in that regard. Give it some thought, contact your insurance professional, have that discussion with him or her or the company and, you know, look around, shop around. If you do have your financial advisor, I'm pretty sure that he or she will discuss that with you. If your advisor, planner, whomever is only going over your investments, you may want to reconsider that relationship because they should be taking a look at your whole enchilada. And again, all your insurance needs should go into that review. And also speaking of that, your life insurance as well, which makes me want to, go into that a little bit more. I know I discussed it before. There's some other circumstances I'm thinking of that make me want to talk about it again, but I'll save that for another day. Anyway, that's pretty much it for me. I hope you're having a great day, and I will talk at you later. Tell

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me

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why!

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Tell me why!