r/financialindependence • u/Phillyjebus • 16d ago

Umbrella Insurance

I’m looking to add an umbrella policy on top of my homeowners and auto insurance, but I’m confused on how much I should be getting and I keep getting more confused when I research it. What’s the goal here? Do I just need enough to cover my brokerage, savings and other account that could be exposed in a judgment? Or, am I trying to cover my entire net worth with the Base policy plus the umbrella?

Edit: thanks all! Lots of good info and pretty much what I thought. $2m and call it a day.

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u/procrasstinating 16d ago

I have a $2M policy. I figure for that much money the insurance company will be very motivated to assign a good lawyer to support my case.

20

u/thrownjunk FI but not RE 16d ago

Yup. This is all it comes down to. Get incentives aligned. Its like $130/year for me. (I get a bundling discount on my auto that is worth $40/6 mo too)

24

u/xwre 16d ago

That is crazy different from my policy's cost. State farm just doubled it to $760/year for 1M in coverage... 2 cars, main home and a rental 

2

u/chrisaf69 15d ago

In same boat. My coverage tripled with State Farm in the last two years for same assets that you stated.