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Thomas Beard
  • Bakersfield, CA
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Can’t get umbrella insurance

Thomas Beard
  • Bakersfield, CA
Posted Apr 8 2024, 16:40

I tried to get an umbrella policy added to my home owners insurance and was denied due to a recent claim. What other insurance options do I have to protect myself from liability? Can I get an independent umbrella policy through a different company? Or should I just see if I can increase my liability insurance coverage on my rental property policies? 

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Owen Rosen
  • Professional
  • Keego Harbor, MI
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Owen Rosen
  • Professional
  • Keego Harbor, MI
Replied Apr 8 2024, 18:50

You should be able to get an umbrella with another carrier but it's also hard to say without knowing anything about the claim.

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Thomas Beard
  • Bakersfield, CA
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Thomas Beard
  • Bakersfield, CA
Replied Apr 8 2024, 19:47
Quote from @Owen Rosen:

You should be able to get an umbrella with another carrier but it's also hard to say without knowing anything about the claim.

Thanks for that info. It was a pretty small claim for wind damage to the privacy fencing around the property. 
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Owen Rosen
  • Professional
  • Keego Harbor, MI
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Owen Rosen
  • Professional
  • Keego Harbor, MI
Replied Apr 8 2024, 20:13
Quote from @Thomas Beard:
Quote from @Owen Rosen:

You should be able to get an umbrella with another carrier but it's also hard to say without knowing anything about the claim.

Thanks for that info. It was a pretty small claim for wind damage to the privacy fencing around the property. 
That's a very odd type of claim to cause ineligibility for a liability umbrella. You might want to inquire about a new insurance provider.

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Allan C.
  • Rental Property Investor
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Allan C.
  • Rental Property Investor
Replied Apr 8 2024, 22:51

@Thomas Beard I know this diverges from the intent of your post, but I think there’s a valuable lesson for other investors to learn from your story.

My philosophy is to avoid making insurance claims unless absolutely necessary because the consequences are higher costs down the line. Whether it’s higher premiums, inferior coverage, or other, my experience suggest to not make a claim unless costs exceed $10k. This threshold will vary by investor and circumstances, but it’s a threshold everyone should define and prepare for.

This ultimately factors into your reserve assessment and your deductible selection. Carrying min deductibles as an investor doesn’t make sense, so don’t pay the extra premium for it.

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Mark S.
  • Real Estate Investor
  • Saint Paul, MN
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Mark S.
  • Real Estate Investor
  • Saint Paul, MN
Replied Apr 9 2024, 05:50

@Thomas Beard that makes absolutely no sense at all. I spent many years in the insurance business and have never heard of a policy application for an excess, or umbrella, policy to be denied because of a claim, especially a property damage claim. Umbrella policies protect you against liability, not property. Complete different category. There has to be more to this. 

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John Mocker#1 Insurance Contributor
  • Insurance Agent
  • Norwalk, CT
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John Mocker#1 Insurance Contributor
  • Insurance Agent
  • Norwalk, CT
Replied Apr 9 2024, 06:39

Thomas,

As several other posts have mentioned, a property claims should not logically impact the eligibility for Umbrella coverage.  However, each company files their guidelines and yours may have a guideline that states that any claim will preclude it.  The other thing that could be an issue is if the claim is still open.  

Your options now are to shop all the coverage or to look for a Standalone umbrella policy.  There are several that we use in these situations (Personalumbrella.com, RLI, USLI, ....).  It appears that PersonalUmbrella.com should be able to handle one claim if under $25,000 total paid out.  If your agent can not access them, PM me and I can check with the company to see who are CA agents for the program.