Nonprofit Insurance Program

Umbrella Liability – What your Nonprofit Needs to Know

By Alexa Connelly
November 06, 2012

Many people are very confused as to what umbrella insurance is and what it covers. Is umbrella liability insurance right for you, your business or non-profit organization? Let’s look at what umbrella liability insurance is first.
Umbrella liability insurance is a policy that is an additional layer of coverage above your other insurance policies. Lets say you have an insurance policy with a liability limit of $400,000 and you purchased a rather inexpensive $1,000,000 umbrella policy, that would make your original policy $1,400,000. Your umbrella policy would kick in when your other policy is exhausted.
Umbrella insurance policies are a very wise decision for both small and big business owners and also non-profit organizations. You are probably asking why. The reasons are very simple. Lets say that Joe has a non-profit organization delivering food and clothing to needy people and he has an accident in the vehicle owned by the non-profit. The person who was in the other vehicle just happens to be paralyzed or worse and the family sues. The non-profits insurance policy may cover the vehicle and some of the medical costs, but not the attorney costs nor the verdict in the lawsuit. Where will that money come from? It is a non-profit organization and with something such as this, the poor and needy who relied on those clothes and food may not have them any more. An umbrella liability insurance would cover the attorney costs, the settlement or monetary verdict and probably save the non-profit from having to close its doors.     Umbrella liability insurance really makes good sense. It is in most cases a very inexpensive protection from the unexpected. It will cover many of the items your primary insurance covers and usually even more. Many people have found that umbrella insurance is the wisest choice they could ever make to “back up” their nonprofit organization, business, home and automobile coverage.
Lawsuits are one of the top reasons to have an umbrella insurance. By having an umbrella policy, if you are sued, you will have insurance lawyers defending you. They don’t want to pay the insurance if they don’t have to, so their team of attorneys will be fighting in your corner all because you purchased their low cost umbrella plan.
Umbrella liability, as you can see, is a very smart move. It is an easy insurance to be approved for. The smart move is carry an umbrella because you just never know when the rain may fall!

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