Umbrella vs. Excess Liability - What's the difference?
02-24-2011, 02:53 PM
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Umbrella vs. Excess Liability - What's the difference?
Many people get umbrella insurance and excess liability insurance confused. So, I'd like to take a moment to outline and educate boaters on what exactly these coverages are and also inform everyone on how it applies to the performance boating industry.
Let's start by defining what both types of coverage is:
UMBRELLA LIABILITY: A type of liability insurance available to individuals (and companies) protecting them against claims above and beyond the limits listed and covered by their primary (aka underlying) policy limits. An umbrella often times extends over MULTIPLE policies such as their home, auto and boat insurance policies. The cost of umbrella policies is typically very low for very high limits.
EXCESS LIABILITY: A type of insurance coverage that provides extended limits over the primary limits of ONE type of policy. The cost of excess liability is typically more expensive than a personal umbrella policy as it is used in the marine industry most often when umbrella policies are not available.
So, how does this apply to performance boats and boaters?
Many of you have probably found, if you've looked into it, that obtaining an umbrella insurance policy that will include your performance boat is rather difficult and in some cases downright impossible. You're not alone.
I can only speak based on the markets we represent for the rest of this post.
For those of your with performance V-Hull boats:Our non high net worth markets will write an umbrella on a performance V-Hull up to 75mph if you place the supporting lines of business with the carrier as well. So you would need to have your home, auto, toys and umbrella with the same carrier to be considered. They will consider limits up to $10,000,000 on the umbrella. The premium on these are phenomenal!
Our three high net worth package markets will write an umbrella on V-Hulls up to 120mph with limits up to $25,000,000 on the umbrella. The cost is surprisingly inexpensive in comparison to the excess market.
As for those of you with CAT Hull boats
If you have a CAT capable of 70mph - 100mph you can purchase an excess liability policy for the cost of roughly $650 per $1,000,000.
If you have a CAT capable of 101 - 140mph you can purchase an excess liability policy for the cost of roughly $1350 per $1,000,000.
We also have a market that will write over 140mph and the rates on that are done on a case by case basis.
Unfortunately, the likelihood of obtaining an umbrella that will include your CAT, will be very difficult. We have only been able to obtain an actual umbrella when there was A LOT of net worth on the account.
For those of you who have existing umbrella policies through your home/auto carrier I encourage you to sit down with your actual umbrella policy and double check that your performance boat is indeed covered. When I have sat down with clients in the past and gone through their umbrella policies with them over the phone they were shocked to find that small stipulation in the policy wording that limits the speed of a boat on the umbrella policy to a maximum of 55mph!!!!! Do your homework and read your policy. If you find that it is excluded, you can call on us for some advice and assistance, after all, that is what we are here for.... to help you.
Let's start by defining what both types of coverage is:
UMBRELLA LIABILITY: A type of liability insurance available to individuals (and companies) protecting them against claims above and beyond the limits listed and covered by their primary (aka underlying) policy limits. An umbrella often times extends over MULTIPLE policies such as their home, auto and boat insurance policies. The cost of umbrella policies is typically very low for very high limits.
EXCESS LIABILITY: A type of insurance coverage that provides extended limits over the primary limits of ONE type of policy. The cost of excess liability is typically more expensive than a personal umbrella policy as it is used in the marine industry most often when umbrella policies are not available.
So, how does this apply to performance boats and boaters?
Many of you have probably found, if you've looked into it, that obtaining an umbrella insurance policy that will include your performance boat is rather difficult and in some cases downright impossible. You're not alone.
I can only speak based on the markets we represent for the rest of this post.
For those of your with performance V-Hull boats:Our non high net worth markets will write an umbrella on a performance V-Hull up to 75mph if you place the supporting lines of business with the carrier as well. So you would need to have your home, auto, toys and umbrella with the same carrier to be considered. They will consider limits up to $10,000,000 on the umbrella. The premium on these are phenomenal!
Our three high net worth package markets will write an umbrella on V-Hulls up to 120mph with limits up to $25,000,000 on the umbrella. The cost is surprisingly inexpensive in comparison to the excess market.
As for those of you with CAT Hull boats
If you have a CAT capable of 70mph - 100mph you can purchase an excess liability policy for the cost of roughly $650 per $1,000,000.
If you have a CAT capable of 101 - 140mph you can purchase an excess liability policy for the cost of roughly $1350 per $1,000,000.
We also have a market that will write over 140mph and the rates on that are done on a case by case basis.
Unfortunately, the likelihood of obtaining an umbrella that will include your CAT, will be very difficult. We have only been able to obtain an actual umbrella when there was A LOT of net worth on the account.
For those of you who have existing umbrella policies through your home/auto carrier I encourage you to sit down with your actual umbrella policy and double check that your performance boat is indeed covered. When I have sat down with clients in the past and gone through their umbrella policies with them over the phone they were shocked to find that small stipulation in the policy wording that limits the speed of a boat on the umbrella policy to a maximum of 55mph!!!!! Do your homework and read your policy. If you find that it is excluded, you can call on us for some advice and assistance, after all, that is what we are here for.... to help you.
