Do I Need Umbrella Insurance in California? How It Works, in Plain Words

If you own a home or have savings you've built over years, it's worth a serious look. Umbrella insurance is extra liability coverage that sits on top of your home and auto policies and pays after their limits run out.

The more you own, the more there is to protect. That's the short answer to "do I need umbrella insurance," and it's why we bring it up with every homeowner we work with.

Darlene Baxter is a licensed California insurance agent and owner of Darlene Baxter Insurance Agency in Pleasant Hill, CA, helping homeowners, families and business owners get covered with real choices: their main company first, and other companies through the brokerage when it isn't the right fit. Umbrella is the coverage people ask her the most questions about.

Your home and auto policies each come with liability coverage. That's the part that pays when you're blamed for hurting someone or damaging their property. Each one has a limit, a maximum it will pay.

An umbrella policy sits on top of both. When a claim is bigger than the limit underneath, the umbrella picks up where it stops.

Here's an example, with made-up numbers to show how it works. Say you cause an auto accident and someone is badly hurt. The court awards them $900,000. Your auto policy has a $500,000 liability limit, so it pays $500,000. Without an umbrella, the other $400,000 can come from you: your savings, your home equity, even future wages. With a $1 million umbrella, the umbrella pays the $400,000.

Two things. It doesn't pay for damage to your own home or your own vehicle. Your home and auto policies handle that.

And it isn't a replacement for them. It only works on top of them. The policy wording always decides what's covered, so we go through the coverages with you before you sign anything, not after.

It's worth a serious look if any of these sound like you:

• You own a home, or have savings and retirement accounts you've built over years.
• You have teen drivers in the house.
• People come over often, or you have a pool, a trampoline, or a dog.
• You own a rental property.
• You drive a lot, including the daily commute on 680.

Enough to protect what you own. We offer umbrella policies from $1 million to $5 million. We look at your home, savings and other assets with you and talk through the right amount.

Sometimes. Every company requires certain liability limits on your home and auto first, so the umbrella has something to sit on. We check your current limits and show you what, if anything, needs to go up, and what that costs.

Often it can, when that property's own policy meets the company's requirements. The same goes for a boat or a motorcycle. Tell us about everything you own so the umbrella covers all of it.

If you rent a home out, our landlord insurance page explains the policy that goes underneath.

Darlene Baxter is a licensed California insurance agent and owner of Darlene Baxter Insurance Agency in Pleasant Hill, CA, helping homeowners, families and business owners get covered with real choices: their main company first, and other companies through the brokerage when it isn't the right fit.

Darlene and Michelle Henning handle umbrella policies. We start by looking at your homeowners and auto insurance together, since the umbrella depends on both. We can't promise a price or approval. Those decisions belong to the insurance companies.

Call the office at (925) 940-6970 or send us a message. If you're still asking "do I need umbrella insurance," we'll walk you through it with your own numbers. Our umbrella insurance page has a picture of how it sits over your other policies.