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How
Much is Enough?
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That
is a difficult question! The proper amount of excess liability insurance
is really an individual decision, but can be shaped by the answers of
these three questions.
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How much do you have to lose? |
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If
you calculate your after tax income to retirement and add that to your
current net worth, you'll get a crude number on how much you have to
lose if you are sued for an event like a serious auto accident, where
you have been deemed to be at fault.
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How much time do you have? |
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You
can look at this question from two perspectives. First, if you are early
in your career you have all those years of income that is exposed to
a lawsuit. Or second, if you are late in your career or retired, you
have your net worth that is exposed and very little time to make it
up.
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What
really is your exposure? |
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As
your exposure grows, so does the possibility that you can be held responsible
for an accident. You may have a personal residence, automobiles (especially
sports cars), youthful drivers, a watercraft, recreational vehicles
(ATV's, snow mobiles), a vacation property, rental property, or a board
position for a nonprofit, all these items and more increase your exposure.
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The
good news in answering the question "how much is enough "
is that, at about $200 for each $1,000,000 of Umbrella Liability coverage,
the cost is not overwhelming to maintain ample insurance coverage. But
as a fall Back, you might consider increasing the deductible on your
home insurance policy and putting the premium savings into added liability
coverage. You can handle the small claims; it's the catastrophic loss
you want to have fully insured.
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| Man's Best Friend! | ||||||||||||||||||||||
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Insurance
companies paid out $310,000,000 in dog attack claims last year. Expect
your insurance carrier to take a closer look at Fido and his breed in
the future.
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| Estate Planning | ||||||||||||||||||||||
| Amplify your Charitable Gifts with Life Insurance | ||||||||||||||||||||||
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Making
a gift to your favorite charity or university is clearly a generous
gesture. Whether a spontaneous gift or a program of planned giving,
using life insurance as the vehicle for your gift can amplify the value
of the gift by 10 to 15 times the actual gift, with the same tax benefits.
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1700 East Putnam Ave
Old Greenwich, CT 06870 203.637.6655 Fax 203.637.6700 |
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