Tuesday, November 17, 2009

Protect yourself against liabilities

By Quang Nguyen

We learned in class that in order to protect ourselves against any liability, it is best to purchase an umbrella insurance. But what really is an umbrella insurance? It makes sense for adults to start taking responsibility for their own lives, much has to be taken into account. One of the hardest parts to be able to plan for, however, is the possibility of unexpected expenses. It’s not only a good idea to have cash or another form of liquid asset in order to cover for this, but it’s a great idea to have insurance, as well. And, one of the best and easiest ways to cover all your bases is having umbrella insurance.

By definition, the umbrella insurance refers to an insurance policy that protects the assets and future income of the policyholder above and beyond standard limits set on their primary policies. It provides coverage beyond the typical auto or home insurance and can include coverage for claims such as false arrest, libel, slander, and invasion of privacy.

It is very likely for any person to get sued in America. With so many lawsuits being filed today, purchasing umbrella insurance is almost a must. According to Bobbie Sage of About.com, with an umbrella policy, one can add an additional 1-5 million in liability protection. The umbrella kicks in when the amount that the other policies cover has been depleted. Some might think that with this extra policy that adds so much more liability protection that it would cost an arm and a leg. On the other hand, for the protection that one receives, the additional cost is fairly low.

You should learn your lesson from so many famous court cases that resulted in millions of dollar in damage reward. Some of the examples include the McDonald hot coffee case. In this case, Stella Liebeck purchased a hot coffee from McDonald. She then spilled it on her lap on her own fault and causing herself third degree burns. She then sued McDonald and was awarded $2.9 million in damage.

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  1. Very interesting. Umbrella programs seem very important to have since many unexpected things in life can happen, so it is best to be prepared for the worst. - Jonathan Tse

  2. I hope that I could get the insurance program as soon as possible.
    Shawn Gao