Those are two really good questions and neither one is a simple answer.
What is an Umbrella policy?
An Umbrella policy is designed 
to give you additional liability coverage, should you find yourself in a lawsuit due to an accident or claim and your home or auto policy does not have enough coverage for the damages being sought. All policies are not created equal, so you have to be careful.
A “true” Umbrella policy will extend past your auto and home policy to give broader coverage. There are some policies that use the term Umbrella, but are what we call “excess” policies. Excess policies don’t give you broader coverage and if your underlying policy excludes coverage, they typically exclude the coverage as well. So you have to be careful when shopping for an Umbrella policy.
Two good questions to ask your agent:
- Is this a “true” Umbrella or an “excess” Umbrella policy?
- Does this policy exclude punitive damages?
Do you have an Umbrella policy?
Do you know if it is a true Umbrella policy and if it excludes punitive damages?
Do I need it? Part 2 is coming later this week. Look for more!
Part 2