Picture this scenario – You win the lottery and you start to buy the things you’ve always dreamed of. You buy a big, beautiful house, a new luxury car, a shiny yacht. You might say to yourself, “Forget about insurance – If anything happens to my property, I have enough money to just replace it.” This may be true, but you probably haven’t considered liability, especially since you are rich and have just become a target for lawsuits, especially frivolous lawsuits. A good umbrella insurance policy would cover this.
Consider this, someone slips on the snow on the front property of your new house. Or someone falls off of your boat. Or you hit a bicyclist while driving your car. Or somebody that knows you just won the lottery launches a frivolous lawsuit. First of all, you need to have an auto, home, and boat insurance policy to cover the liability in these types of situations. But, these types of policies usually only cover you up to a million dollars. But being that you just won the lottery, people will know that you are rich enough to cover a lawsuit of more than a million dollars. That means, in a successful lawsuit against you, you could be liable for more than $1 million. A good umbrella insurance policy would cover this type of risk.
An umbrella insurance policy is designed to give you liability protection above what your usual home, auto, and boat insurance policies cover you. The usual coverage is between $1 million and $5 million above your usual liability coverage, but you could even go as high as $10 million or more with an insurance company that specializes in high net-worth people. As a lottery winner, this is probably the best protection you could have for your assets.
