How much do umbrella policies usually cost?

An umbrella policy can pay what you owe if you're found to be at fault for someone else's injuries or property damage. The cost of umbrella insurance typically starts around $200 per year for $1 million of coverage .

How much should a $1 million umbrella policy cost?

A $1 million umbrella policy costs around $150 to $300 per year , with the cost increasing a small amount for every additional million. As with any insurance policy, your exact price will depend on individual risk factors, including the number of people in your household and how many cars and properties you own.

How much is a $3 million umbrella policy?

A $3 million umbrella policy costs around $275 to $425 per year , on average. Every policyholder's umbrella insurance premium will vary based on their personal risk factors, so individuals who own more cars or properties will be more expensive to insure, as will people who are particularly likely to be sued.

How cheap is umbrella insurance?

Umbrella insurance is actually very inexpensive. A $1 million umbrella policy only costs around $150–300 a year . And if you want to bump your coverage up to $2 million, you'll only pay an extra $75 per year. In fact, for each $1 million in coverage you add, you'll only pay an extra $50 a year on average.

Is $1 million enough for an umbrella policy?

The rule of thumb for umbrella insurance is to buy as much coverage as your total net worth, factoring in assets like your home, car, investments, and even your retirement accounts. For example, if you own assets worth $1 million, then you should purchase at least $1 million in umbrella coverage .

Are umbrella plans worth it?

If you are concerned about the coverage limits from your traditional auto or homeowners insurance to protect your assets in the case of being found liable for an incident, it may be worth talking to your insurance agent about an umbrella insurance policy .

Why is my umbrella policy so expensive?

The cost of an umbrella liability policy depends on how much coverage you purchase, the state where you live (insurance rates vary by state) and the risk that insuring you presents to the insurance company . The more homes or cars you own, and the more household members your policy must cover, the more it will cost.

Does Costco have umbrella insurance?

Costco auto insurance review. While Costco does not technically sell car insurance, the store offers its members discounts on homeowners, auto, and umbrella insurance policies through CONNECT, powered by American Family Insurance .

How much does a $5 million dollar umbrella policy cost for construction?

A $5 million umbrella policy costs around $375 to $525 per year , on average. Every policyholder's umbrella insurance premium will vary based on their personal risk factors, so individuals who own more cars or properties will be more expensive to insure, as will people who are particularly likely to be sued.

Does umbrella insurance policies usually provide coverage for $1 million or more?

How umbrella policies work. If your homeowners insurance has a liability limit of $300,000, you may add an umbrella policy with an additional $1 million of coverage . That would give you a total of $1.3 million dollars of protection should someone be injured at your home.

What does an umbrella policy not cover?

An umbrella insurance policy does not cover your own injuries or damage to your personal property . In addition, personal umbrella insurance will not cover intentional acts, criminal behavior, damage caused while you're performing business activities, or damage from certain dogs or vehicle types.

Umbrella Insurance Cost: Average Price (2024)

Cost is a key factor when you are shopping for umbrella insurance. When looking for the lowest cost policy or ensuring you have the best value on the policy you already hold, it’s a good idea to understand the factors that go into the cost of your umbrella insurance premium.

An independent insurance agent can answer any questions you might have. Independent agents are devoted to helping you to get your questions answered so you can make an informed choice.

Your agent can compare policies, options and quotes from several insurance companies and help you choose the right umbrella insurance for you. Contact an agent today to get started.

You may want to set up a “cost-benefit analysis” as you start to compare umbrella insurance policies. Here is some data to help you get started.

Umbrella Insurance Cost Facts:

13% of personal injury liability awards and settlements are $1 million or more
An estimated 1 in 5 people with considerable wealth do not have umbrella coverage
An average cost of about $380 per year can provide $1 to $2 million of protection

As you can see, there are several ways that an umbrella policy can help protect you for a relatively low cost.

Factors Affecting Average Umbrella Insurance Cost

So, you’ve decided that spending extra money for excess liability coverage is a worthwhile investment to protect what you’ve earned. There are a number of factors that may affect your umbrella insurance costs, including:

Your net worth: Basic umbrella insurance policies begin at $1 million. Ideally, your policy should be equal to or greater than your net worth. If you need to determine the amount of assets you have, consult a lawyer or financial advisor.
Your location: Insurance rates vary considerably by state. The cost of umbrella insurance in Louisiana may not be the same price for the same coverage in California.
Your credit history: If your credit history is less than stellar, your umbrella insurance cost may not be as low as you’d like. Normal liability policies examine your credit history to determine how risky you are to insure. If you’ve improved your credit score after buying your umbrella policy, be sure to speak with your agent about reducing your insurance costs.
Driving records in your household: Because your umbrella policy costs are based on everyone in your family, your family’s record of driving infractions, speeding tickets and accidents may affect your umbrella insurance costs.
A teenager in your household: If you have one or more teens that drive, you’re already aware of how teens affect your auto insurance rates. Umbrella insurance costs will be similarly affected. But because teens are more prone to accidents, now is a perfect time to purchase additional liability coverage.
Your risk profile: Do you own a dog? Is there a trampoline, swimming pool or zip line in your backyard? Do you frequently throw parties? Do you own a boat, personal watercraft or high-powered vehicles, such as a snowmobile or ATV? Discuss what kind of things put you at risk with your independent agent.
Insurance company you choose: If you don’t compare policies, you may end up paying too much for coverage. Combining your policies with one insurer can earn you a significant umbrella insurance discount.

Save on Umbrella Insurance

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How to Calculate the Cost of Umbrella Insurance

The cost of umbrella insurance can range from $200 per year on the low end to over $1,000 for a high limit, such as $10 million worth of umbrella liability coverage. How can you determine how much the umbrella policy will cost? You can check out our umbrella insurance calculator, or follow the steps below:

The first step is to assess your net worth. Determine the value of your assets, including liquid assets, investments, retirement funds, properties and annual income. You may need to consult an investment advisor or attorney.

Next, review both your risks and whether you may be a “target” for liability lawsuits. If you are a high profile person or have considerable assets that an attorney will find inviting when defending a client, you want to factor this into your costs.

Finally, choose an amount of coverage that can protect you from potential lawsuits that could threaten your savings and standard of living.

By many recommendations, the coverage amount should be at least equal to your net worth, but that may just be a starting point for you. A report by ACE Private Risk Services, for example, pointed out that judgments in severe cases have run $14 million to $49 million.

The ACE report provides these typical umbrella policy annual costs:

$383 for $1 million in coverage for a household with one home, two cars and two drivers
$474 for $2 million in coverage for the same household
$608 for $5 million in coverage for the same household
$999 for $10 million in coverage for the same household
$1,578 for $10 million in coverage if the household also has 2 more homes, 2 more cars, a boat under 26 feet, and a driver who is under 25

Working with an independent insurance agent can help you get the information you need to determine the right amount of coverage for your family. Additionally, your local agent can help you compare multiple umbrella insurance quotes and look for discounts on your policy.

Save on Umbrella Insurance

Our independent agents shop around to find you the best coverage.

Finding the Best Umbrella Insurance Value

Buying umbrella insurance is a balancing act – you must find the amount of coverage that can secure your assets at a cost that makes sense for you.

Umbrella insurance can protect your life savings, but finding the best policy at the best price for your needs and budget can be a challenge because no two insurance companies are alike.

Working with an independent insurance agent can make your search much easier. Local member agents have access to quotes and policy options from multiple insurance companies and can help you find an affordable umbrella insurance policy that will help cover your risks.

Contact a local independent insurance agent today for personalized assistance.

Umbrella Insurance Cost: Average Price (2024)

Umbrella Insurance Cost Facts:

Factors Affecting Average Umbrella Insurance Cost

How to Calculate the Cost of Umbrella Insurance

The ACE report provides these typical umbrella policy annual costs:

Finding the Best Umbrella Insurance Value

FAQs

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