You have to consider the value of your assets when deciding if you need umbrella liability insurance. If you are rich in assets, it's a good idea to have this extra coverage for stronger protection. It's especially useful if you live an edgy lifestyle that might lead to damaging other people's property by accident. Raising young kids or owning aggressive dogs are other reasons to add umbrella coverage. If you don't have sufficient coverage, but you own valuable assets, it's possible to be drained of your assets in the event of a lawsuit. In this case, you can likely afford the additional low-cost protection that will go a long way if you cause an accident that affects someone else's property. You'll at least have peace of mind that your insurance company will pay for such damages. Throwing regular parties at your home sounds like a blast until someone slips and falls in your driveway and ends up with costly medical bills. You can be stuck paying those bills out of pocket if they exceed the limits of your standard homeowners policy. However, your umbrella insurance will save you from this financial fiasco instead of draining your retirement or savings account. An alternative to an umbrella plan is purchasing endorsements to your auto or homeowners insurance. This option works when umbrella coverage is too expensive for you. It might not be as much protection, but it's still better than nothing. You can ask your insurance agent about another option known as a bundling discount.