Personal umbrella policies provide excess liability insurance over the insured's basic primary policies, such as the homeowners, personal auto and boaters policies. Coverage is provided on a worldwide basis for the entire family. Umbrella policies pay only after the limits of the underlying primary policies are exhausted. Coverage is usually broader and applies to some loss exposures not covered by the primary policies. A typical umbrella policy will provide coverage on a single limit occurrence basis.
Coverage is provided for bodily injury and property damage liability.
Defense costs are also covered, normally in addition to the liability limit, and sometimes included as a part of the total limit. A self insured retention must be met when certain losses are covered under the umbrella policy but not covered under the primary policy. The insurer requires the insured to carry certain minimum amounts of liability insurance on primary policies. Coverage under a personal umbrella policy can vary depending on the insurer since there is not a standard personal umbrella policy form. Under the personal umbrella policy, the personal injury liability coverage is usually broadly defined to include coverage for bodily injury, sickness, disease, disability, shock, mental anguish, and mental injury.