So you have an umbrella insurance policy...
07-13-2015, 12:18 PM
#1
HP Marine Ins. Specialist
Thread Starter
Join Date: Mar 2008
Location: Insuring any kind of boat
Posts: 985
Likes: 0
Received 0 Likes
on
0 Posts
So you have an umbrella insurance policy...
So you have an umbrella insurance policy (personal liability)...
________________________________________
Does is REALLY extend over your boat or is that your assumption?
My interactions with potential clients and existing clients are always what inspire the topics that I choose to write about. I feel that if just one person is asking a question, or doesn’t understand an insurance product or concept they are probably not alone.
When I am taking an application for a new quote from someone calling in, one of the obvious questions I ask is: “What level of liability coverage are you interested in carrying?” The responses, while they vary, all have the same tune when the caller mentions they have an umbrella liability policy. I often hear one of the following comments:
“Well, I have a personal umbrella policy that covers me on this boat so give me middle of the road limits.”
My response to this: "Awesome! You are one step ahead of the next guy because you actual carry additional liability coverage to protect yourself. However, did you know that…"
a. Most insurance carrier’s umbrella products, specifically exclude boats capable of OVER 65mph.
b. If you do not specifically list your primary boat insurance policy on the actual umbrella policy and pay the additional premium, then your umbrella policy will NOT extend over your primary policy.
c. If you do not carry the minimum underlying liability amount on your primary boating policy and the boat was listed under the umbrella, you would be creating a gap in coverage that in the event of a major catastrophe, you would be liability for filling. Meaning. IF you have an umbrella that kicks in after $500,000 in losses on your primary but you chose to only carry $300,000 on your primary boat policy, then you would be responsible for paying the $200,000 out of pocket before the umbrella policy would begin to pay out on a loss. This would be a costly mistake.
Most of the callers that I talk to did not realize the above and often indicate that they will need to check on if their carrier really does cover the boat they own or are looking to buy. I love that the comments inspire discussion with their existing home/auto agents!
“I have a business and we have large liability limits to cover me.”
My response is usually very short and sweet: “unless your business is operating the boat and owns the boat, your commercial umbrella does not extend coverage over a pleasure performance boat policy.
I could go on and on, but I won’t bore you with that. If you carry an umbrella, I encourage you to do your homework and know what it takes for your carrier to extend coverage over your performance boat. You may find that they just won’t do it. In that event, you will need to carry higher limits on the primary boat policy to compensate for lack of umbrella protection.
Should you have any questions, feel free to ask. If you have a specific umbrella situation that you’re wondering about that others could learn from, feel free to post it here and I will respond.
Have a great day!
________________________________________
Does is REALLY extend over your boat or is that your assumption?
My interactions with potential clients and existing clients are always what inspire the topics that I choose to write about. I feel that if just one person is asking a question, or doesn’t understand an insurance product or concept they are probably not alone.
When I am taking an application for a new quote from someone calling in, one of the obvious questions I ask is: “What level of liability coverage are you interested in carrying?” The responses, while they vary, all have the same tune when the caller mentions they have an umbrella liability policy. I often hear one of the following comments:
“Well, I have a personal umbrella policy that covers me on this boat so give me middle of the road limits.”
My response to this: "Awesome! You are one step ahead of the next guy because you actual carry additional liability coverage to protect yourself. However, did you know that…"
a. Most insurance carrier’s umbrella products, specifically exclude boats capable of OVER 65mph.
b. If you do not specifically list your primary boat insurance policy on the actual umbrella policy and pay the additional premium, then your umbrella policy will NOT extend over your primary policy.
c. If you do not carry the minimum underlying liability amount on your primary boating policy and the boat was listed under the umbrella, you would be creating a gap in coverage that in the event of a major catastrophe, you would be liability for filling. Meaning. IF you have an umbrella that kicks in after $500,000 in losses on your primary but you chose to only carry $300,000 on your primary boat policy, then you would be responsible for paying the $200,000 out of pocket before the umbrella policy would begin to pay out on a loss. This would be a costly mistake.
Most of the callers that I talk to did not realize the above and often indicate that they will need to check on if their carrier really does cover the boat they own or are looking to buy. I love that the comments inspire discussion with their existing home/auto agents!
“I have a business and we have large liability limits to cover me.”
My response is usually very short and sweet: “unless your business is operating the boat and owns the boat, your commercial umbrella does not extend coverage over a pleasure performance boat policy.
I could go on and on, but I won’t bore you with that. If you carry an umbrella, I encourage you to do your homework and know what it takes for your carrier to extend coverage over your performance boat. You may find that they just won’t do it. In that event, you will need to carry higher limits on the primary boat policy to compensate for lack of umbrella protection.
Should you have any questions, feel free to ask. If you have a specific umbrella situation that you’re wondering about that others could learn from, feel free to post it here and I will respond.
Have a great day!
