[retiredguy123]

Originally Posted by lawgolfer

You appear to be confusing the additional coverage for "personal injury" in an umbrella policy with the increase in the limits for "bodily injury" in the underlying policy.

Both a homeowners policy and an auto policy cover "bodily injury" which means physical injury including pain and suffering. The umbrella policy adds a completely new coverage, that for "personal injury"

Personal injury is defined in the umbrella to include such things as false arrest, defamation, libel, slander, false imprisonment, and trespass. Some of these may cause a claimant to suffer "emotional distress". Such damages will be covered.

The "personal injury" coverage is a liability coverage. Liability insurance only pays for damages incurred by a "third party", i.e. the neighbor on whose property the insured trespassed or the contractor the insured slandered. Liability insurance, whether for bodily injuries or personal injuries, will never pay anything to the insured. It only pays the third party claimant for the harm done to him by the insured.

In addition to the coverage for "personal injury" in an umbrella policy, the umbrella will increase the limits of the underlying policies be they homeowners, auto, or both, for property damage and bodily injury. This means there will be more money to pay to a third party claimant and more to protect the assets of the insured. Again, nothing in a liability policy be it underlying or umbrella will be paid to the insured

If the insured in the underlying auto policy had UM/UIM coverage, he can increase the limits of that coverage in the umbrella policy. There is no additional coverage for UM/UIM in the umbrella policy. It simply increases the amount of money the insured can collect for injuries done to him by the uninsured or underinsured driver. The damages for which the insured can collect include the pain and suffering he incurred as a result of his bodily injuries caused by the uninsured/underinsured driver.

In summary, the coverage for "personal injury" in an umbrella policy will never result in payment to the insured. The increase in the limits for bodily injury and property damage in an umbrella policy will only be paid to a third party claimant and only increase the protection of the insured's assets. The increase in the UM/UIM limits in the umbrella will only be paid to the insured

I hope my lengthy responses to this post, along with those of others, will convince you that UM/UIM coverage is not a waste of money and will not benefit only the insurance carriers. It is for your protection and the protection of those who use your automobile. Given that more than 20% of all drivers in Florida have no auto insurance, compared to 14% nationwide, UM/UIM insurance is all the more important in Florida. Studies have confirmed that drivers who are uninsured or have minimum limits of insurance are far more likely to be involved in auto accidents when compared to drivers with insurance.

Thanks for the explanation. You make a good case for an umbrella policy for someone who has substantial assets. But, I believe that the vast majority of people do not buy an umbrella policy. Instead, they just buy the basic UM policy recommended by insurance salespeople. The policy limits on these policies are woefully inadequate to ever compensate them for "pain and suffering" after paying for medical bills and lawyer fees. I have no UM coverage, but I do have $1 million in personal liability coverage on my basic auto insurance policy. I have chosen to self-insure against "pain and suffering" rather than to buy an umbrella policy. But, if you are buying UM coverage, consider the cost versus the potential benefit, and the redundancy of coverage (medical and collision), that you are paying for with a UM policy.