Umbrella

[Michael Win]

Hi all,

I have 7 rental properties, high income professional (4-500K/yr), have a 1 mil+ personal residence, 1mil+ liquid/IRA net worth. 41 YO.

My properties are under my name and will not put them under an LLC. I currently have a 1 mil umbrella but my insurance agent thinks I should be at 3-4 mil.

Is 1 Mil enough or should I bring it up to 3-4 mil.  The cost would be an extra $750/yr

[Jason Bott]

@Michael Win there is no right or wrong answer, but up to your risk tolerance.  I have seen some lawsuits threaten landlords for amounts greater than $2M, but have not seen them settle for close to that amount.  If a claim comes through and settles for $2.5M, are you ok with paying the $500k to save the $750?  

You may want to shop you personal policy around.  Make sure you get options from the top companies who have preferred pricing for affluent.  By definition the home can not be less than $750k to get options from them.  Those companies are, Chartis, Firemans Fund, Ace and Pure.

As a side not, I have quoted $5M umbrellas for $1200 per year that can handle up to 55 units, but exclude personal residences and autos.  So your $750 may be a little high, but not outrageous.