8 - 1Copyright 2008, The National Underwriter Company Personal Umbrella Coverage What is it? Provides worldwide coverage over and above that provided by the underlying policies Excess liability coverage On top of coverage already in place Dropdown liability coverage Provides broader than that in the underlying policies Chapter 8 Risk Management For Financial Planners

8 - 2Copyright 2008, The National Underwriter Company What do umbrellas have in common? Duty to defend Insured will maintain underlying limits of insurance Varies from insurer to insurer Deductibles Called the retained limit Part of the loss the insured is expected to assume Policy responds to suit for damages alleging bodily injury or property damage arising out of a covered occurrence Chapter 8 Risk Management For Financial Planners Personal Umbrella Coverage

8 - 3Copyright 2008, The National Underwriter Company What do umbrellas have in common? (cont'd) Provide coverage for claims arising out of personal injury False arrest Libel Detention Malicious prosecution Imprisonment Wrongful eviction, wrongful entry Bodily injury, property damage must result from an accident Definition of insured Named insured and spouse (if residents of the same household) resident relatives Chapter 8 Risk Management For Financial Planners Personal Umbrella Coverage

8 - 4Copyright 2008, The National Underwriter Company What dont umbrellas have in common? Umbrella policy may actually be an excess liability coverage policy Provides coverage over that of the underlying policy It does not provide coverage for any liability not already covered in the underlying policy True umbrella provides coverage where the underlying form might not Some umbrellas cover auto accidents anywhere in the world Auto policy only applies to accidents in the United States Some umbrellas cover limited business exposures A few provide coverage for rented aircraft (with a crew) Chapter 8 Risk Management For Financial Planners Personal Umbrella Coverage

8 - 5Copyright 2008, The National Underwriter Company Underwriting and umbrellas Strictly underwritten Might not cover drivers with moving violations Strict criteria is the rule Chapter 8 Risk Management For Financial Planners Personal Umbrella Coverage