Slip-Slide - Safer with an Umbrella

Springtime in Minnesota. Aaahhh. 

You know what a Minnesota Spring is like. Beautiful days, sunshine melting the snow and ice away. But the nights can still get below freezing. Whatever is wet during the day can become hazardous and icy after the sun goes down. 

And if someone slips and falls on the ice on YOUR sidewalk, you could be held liable.

That’s right. Here in Minnesota, it’s our responsibility, as homeowners, to promptly clear the public walkways on our property from snow and ice. Review your state and local laws, regulations and ordinances to understand your specific responsibilities.  Regardless, leaving the sidewalk untreated or otherwise unattended may increase your risk of liability should someone become injured while walking past your house.

That’s when your homeowner’s policy kicks in, right? 

You may think the answer is “Yes, of course,” but in reality the answer is “it depends.” It depends on how your policy is written and what limits and exclusions may apply to the various coverage types. 

If someone slips and falls and fractures a hip on your sidewalk, the amount of the claim could exceed the amount of coverage provided in your homeowner’s policy. Where a person’s damages exceed your policy limits, the injured person can or may pursue a claim against you personally for the excess.  

The same holds true if you cause a car accident that causes significant injuries to another party. Even Minnesota no-fault insurance policies have limitations on how much they will cover for both medical and non-medical expenses. 

And a no-fault policy does not protect you from being found at fault and subject to a claim for damages that exceed your insurance policy limitations. (We go into this more in our post about Minnesota No-Fault Insurance. It’s worth learning more about it.) 

How an Umbrella Helps

An umbrella policy is specifically designed to help protect you from liability that exceeds normal policy limits. 

While it’s similar to “excess liability insurance,” it’s not exactly the same. An umbrella policy could provide additional liability protection. (Talk to your agent to fully understand what an umbrella policy will cover for you, as specifics can vary by insurance company.)

Let’s look at a few hypothetical claims:

You run a red light and crash into another car, driven by a pediatrician. Her car is significantly damaged, and the driver and her passenger are seriously injured. Repairing the car is going to cost about $25,000. The emergency room, ambulance, and overall treatment for the injuries suffered by the two people total up to $175,000. The pediatrician is unable to work for two months, so she has a claim for $75,000 in lost earnings, housekeeping costs, and other expenses. 

That’s $275,000 in total without considering general damages for pain and suffering, all while your insurance policy has a liability (for example) of $100,000. If you do not have an umbrella policy that would cover the excess, you may be personally responsible for the extra.

Another example to consider is if a houseguest falls down your stairs and suffers a compound leg break, requiring multiple surgeries and months of physical therapy for a full recovery.  If your homeowners’ policy limit did not cover their medical bills, you may be personally responsible for the amount over and above your homeowner’s policy liability limit. An umbrella policy is designed to help cover situations just like this. 

Going back to the slip-and-fall on your icy sidewalk, a simple injury might result in a single doctor visit and be covered by your homeowner’s policy. But a broken leg or hip requiring surgical intervention and more could exceed your policy limit– at which point an umbrella policy could help save the (financial) day for you.

Does Everyone Need an Umbrella Policy?

Not necessarily. But everyone should assess their actual risk and make an informed decision. Typically, umbrella policies are beneficial for people with significant assets or a high net worth – people who could be considered “deep pockets” who would be able to pay.

You might not think of yourself as having deep pockets, but if you own more than your primary residence, your car, and the basics for living, you may consider having a conversation with your agent. 

Work with your agent to assess your risks and determine if an umbrella policy may help provide you with coverage for what you hold dear.

Contact Us or call 1-888-507-8030 for information on umbrella policies. We look forward to hearing from you.

This article is for general information only and should not be considered an offer of insurance or legal or other expert advice.  The recommendations herein may help reduce, but are not guaranteed to eliminate, any or all risk of loss.  Claims illustrations herein are hypothetical and for discussion purposes only.  Coverage will be determined based on the facts of the claim and the terms of your policy, if approved for issue.  Policy limits, deductibles, conditions, and exclusions may apply.  Your eligibility and premium will depend on the application of Federated’s underwriting guidelines to your unique circumstances including, but not limited to, your personal information, loss history, location, driving record, and coverage.  The information herein is current as of September 2022 and is subject to change.  Coverage not available in all states.  Qualified counsel should be sought with questions specific to your circumstances.   Policies are underwritten by Federated Mutual Insurance which is licensed in Minnesota.