How an Umbrella Liability Policy Protects you From More than Just Rain

With the passage of Michigan’s auto insurance reform now becoming law, the immediate result will be a reduction in MCCA (Michigan Catastrophic Claims Association) fees for all insured drivers. That is the positive; but as in all things, there is a flip side to this major change in law. There is a reason attorney billboards and television ads have increased dramatically in Michigan.

In fact, I am going so far as to suggest for clients who have current or future assets to protect; that you consider investing a small portion of that savings into the purchase of an umbrella liability policy.

The word umbrella is a fitting term for this protection, as this policy sits over and above your other policies and provides protection when the liability limit on your underlying policies is not sufficient to handle the loss.

Benefits of an Umbrella Policy

An umbrella policy sits over and above your other policies and provides protection when the liability limit on your underlying policies is not sufficient to handle the loss.

Benefits Include:

  • Potential Savings

  • Multi-Policy Discounts

  • Insurance Gap Coverage
  • Umbrella policies increase liability protection for auto, home, watercraft, rental properties and business insurance exposures.

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Let us show you how you can save you money on your auto insurance.

Previously, Michiganders had unlimited full medical protection under their Michigan auto policy, and it was mandatory; so, everyone accessed the medical benefits under their own auto policy. If they did not have auto insurance, there was an order of priority where the benefits would then come from an auto policy in the same household of someone who was related to them by blood, marriage, or adoption; by the owner of the vehicle’s auto policy if it was someone other than the driver, or as a last resort, the State fund set up to catch those who don’t fall into any of these other categories.

Now, however, with Michiganders able to lower their medical protection on their auto policy, there exists what we in the business call a gap in coverage where lawsuits can and will begin to take place for serious auto accidents.

It should be a well-known fact by now that Michigan has always taken care of its injured motorists for life, with unlimited medical benefits that were provided under the PIP (Personal Injury Protection) part of the Michigan No Fault auto insurance policy. The benefits included loss of wages, rehabilitation, replacement services and attendant care. We have provided handicap access vehicles, retrofitted homes for permanently disabled Michiganders, and paid for such things as maintaining the home and residence premises when an auto related injury made those things impossible for the insured to perform due to the injuries or disability.

Now that we are 1 full year into the new Michigan Auto Reform, Michiganders have had time to discuss the major changes in this protection with their agent and have made their own choices to keep or reduce those unlimited medical benefits.

How does an umbrella liability policy come into play?

If you have auto insurance with limits of $100,000 per person and are deemed at fault in a horrible accident that causes multiple injuries and deaths, that $100,000 can be exhausted quickly and then, you will be hearing from attorneys; and a lot of them if the accident involves multiple vehicles.

One accident where we had $300,000 of liability was exhausted almost immediately due to a 2-vehicle accident with 3 killed and 4 more injured.

The cost of a $1,000,000 personal umbrella liability policy is based on the number of vehicles, homes, rental dwellings, recreational vehicles, watercraft, and drivers, but can be as little as $175 per year.

Most companies also provide a discount to your home and auto for purchasing an umbrella, so we do have clients who obtain the umbrella at literally no additional out of pocket costs due to the savings on their other policies.

If you have not discussed the Michigan Auto Reform in detail with a knowledgeable agent, or if your agent has never discussed an umbrella policy for your protection, we are here to help clients navigate the often-confusing terms and definitions of the Michigan auto no-fault law and auto reform so that clients can make informed decisions that are best for you and your family.

As an agency that is committed to taking care of people, we are simply a phone call, text, or email away to assist you with your insurance buying decisions.

Make Sure You’re Covered

Contact Cardinal Insurance today and we can make sure you’re protected.