A personal lines umbrella policy is an insurance policy with high liability limits designed to provide protection over other insurance policies like a homeowners or personal auto. Who needs an umbrella policy? Anyone who wants to protect their personal assets is a good candidate. With the costs of lawsuits increasing, individuals need to protect their families and assets as best they can.
You own a vehicle and your 17 year-old son takes it out for a drive with his friends. The vehicle is involved in an accident that was caused by your son and several people are seriously injured. You end up getting sued for $2,500,000 for the damages that have been caused. If you have a $500,000 auto policy you are really only covered for 20% of the lawsuit. If you had an umbrella for $2,000,000 limits, that would cover the full loss.
Without an umbrella policy the money may have to be used from your personal assets which could leave you bankrupt.