The One Big Reason You Need Personal Umbrella Coverage
When insurance is mandatory and straightforward, it’s pretty easy to buy into. This is why auto, home, and health insurance are as popular as they are. They all make sense – if something happens to your car, home, or body and mind, then you will be covered.
Yet, there is another kind of insurance that makes just as much sense – if not more – than the aforementioned three; but it seems to be lacking in popularity. Is this an awareness issue? Is it just too complicated?
The type of insurance we’re talking about is called Personal Umbrella Coverage. Long story short, this type of policy offers more coverage for less money. Sounds pretty awesome, right?
So, what is personal umbrella coverage? Essentially, it is a type of extra liability insurance that goes above and beyond the limits of a typical home and/or auto policy. This policy offers protection against lost income and legal fees associated with claims – in some cases, even for incidents outside of Canada.
It is, at its core, a way to protect your savings and assets – it acts as a failsafe when everything else goes wrong. And something is bound to go wrong.
Why, then, is it not as popular amongst people? One major reason is that there is a prevalent attitude of “oh, it wouldn’t happen to me” in modern society. Except, it is more likely to happen to you than you may realise.
Take auto insurance as an example. It would be unthinkable to drive around without insurance – even if it wasn’t mandatory. As discussed in a previous blog, the roads are getting more dangerous and premiums are definitely on the rise for a multitude of reasons. In fact, there are over 160,000 accidents that occur on a yearly basis in Canada.
Now, what if instead of 160,000 accidents occurring, over 625,000 occurred? That is the number of active lawsuits in Canada since 2017/2018.
Yes, you read that right – there are, as recent figures suggest, 625,181 active lawsuits currently in Canada. That’s 1,713 lawsuits every day – 71 every hour. Immediately, it becomes clear that coverage against losses incurred from a lawsuit might be more necessary than first thought.
The even bigger worry is that trends point towards increasing lawsuits being filed as the years go on. 2014 saw 596,000 lawsuits – and there has since been an increase every year until the latest figures were released.
Five straight years of increased lawsuits puts into numbers what many have already noticed – society is becoming more sue-happy by the day. One of the major contributors for this is social media. It has never been easier to accuse someone of libel, slander, or breach of privacy and these are no longer just idle threats.
Whether someone is going after you with malicious intent, or if you made a mistake, or even if it was all a misunderstanding – the bottom line is that you are at risk.
Another contributing factor has been hosting events. Whilst throwing a party seems like a fun, harmless act, the reality is that there is an increase in lawsuits arising from such situations. Alcohol is often at the centre of these events and once pets, children, or even strangers get involved – it can be a recipe for disaster.
Lastly, personal umbrella coverage is also incredibly useful as an add-on to auto insurance. A lot of the time, base policy limits are low and are insufficient to cover long-term care and loss of future income. Claim payouts get eaten up quickly and then things become desperate.
On the other hand, being the liable party in this scenario is just as destructive – the losses incurred are often astronomical. Having personal umbrella coverage, though, can offer a great deal of protection against any such situation.
Don’t wait, contact one of our licensed brokers to find out how you can benefit from personal umbrella coverage. Email us at
Why not obtain more coverage for less money?
Source: Canadian Underwriter.