An umbrella policy is insurance coverage over and above what your auto and homeowner’s insurance policies provide. It is relatively inexpensive and can save you from losing your life savings (this includes your home, retirement accounts, checking, and savings accounts, and can even apply to income you will earn in the future.) if you were ever to be found liable for an accident where someone got seriously hurt or killed. If you own a home and a car you should have an umbrella policy.

Umbrella policies offer an inexpensive "peace of mind" for most types of negligence claims. Automobile accidents are probably the most common source of serious claims. This policy supplements your basic automobile liability with extra million-dollar layers of protection. It also covers other types of catastrophic claims such as a neighbor's child drowning in your pool, or the delivery man being seriously injured by falling over your child's toys.