Umbrella Insurance without Car Insurance?

I have been thinking of getting umbrella insurance and was hoping the community here might have an idea about my slightly unusual situation.

Background: We (spouse and I) have homeowners insurance through State Farm. We do not have personal car insurance. We do have one car, which is a company-provided vehicle and we are authorized to use it for any personal use. The company provides an insurance policy for this vehicle.

Problem: I know that typically an insurer will sell an umbrella policy after you have both home and auto insurance. Is it possible to get an umbrella policy without having both of these with the same carrier already? I called State Farm to ask them if they would sell me an umbrella policy, but the agent seemed unfamiliar with my situation and couldn’t give me answer. A few days have also passed without a promised call back. I suppose I will try again with State Farm next week. But in the meantime I was curious if anyone here had a similar situation. Or knew of an insurance provider that would issue me both a home and umbrella policy without auto.

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So you want your personal umbrella to cover you in case of an auto accident in which you are deemed personally liable for damages exceeding the company’s auto coverage?

I’m not an insurance expert. Some thoughts:

  1. The company may have an umbrella policy that may kick in before your personal liability. Worth investigating.
  2. You can, and might have to buy umbrella separately from your current insurance provider. The umbrella requires underlying insurance with certain minimums, but the underlying coverage probably does not have to be in your name (as in your case with a company car). Here’s a couple I’ve seen recommended on FWF and elsewhere:
    http://usli.com/products/individuals/
    https://www.rlicorp.com/personal-umbrella-policy
    I don’t know if these are sold directly or only through brokers/agents, but you should be able to figure it out and give them a call.
  3. The company could probably add you and your wife to their policy as named insured. In this case you should have no issues getting a separate umbrella mentioned above.
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Since there’s no ownership of the vehicle, there’s really no “insurable interest”, as they would say. First, as scripta mentioned, check if the company has an umbrella policy that would limit your liability.

But if you wanted to protect yourself against a potential negligence or general tort lawsuit, a free-standing umbrella policy would work. I would be upfront with them about the company vehicle situation though, they may want to add an addendum to the policy stating their coverage only kicks-in after the limits of the company auto insurance, to prevent someone from attempting to sue where the pockets are deeper. It would also keep the premiums to a minimum.

Thanks for the replies. I think my own lack of understanding of all the insurance angles makes this a little more difficult to figure out. As for what I would want an umbrella policy for, here are a couple of situations off the top of my head.

  1. An accident in our company vehicle that causes injury to others. Could the injured come after both us personally as well as the company? In this case, we do have assets that we would want protected. However, the deeper pockets will definitely not be ours since the employer is a Fortune 100 company. Having never been involved in this type of situation, I’m not sure if the company would be the sole target of any claim/lawsuit, or we could be personally liable as well.

  2. What if the accident occurs in a rental car on vacation? Unlike many personal auto policies, the policy on the company vehicle does not cover us in rental cars (unless rented for business). We count on credit card protection to cover damage to the vehicle, but purchase the additional liability coverage. However, this coverage typically has a limit of $1 million. While it’s highly unlikely we’ll ever need more than that, isn’t this the type of “just in case” additional protection that an umbrella policy would provide? Especially for what I understand is relatively inexpensive type of insurance.

I’ll have to look into those websites - thanks for the recommendations! It would also be helpful if I could get a knowledgeable agent on the phone who could help to clear this up for me.

From my limited knowledge of litigation, I would imagine both you and the company would be named in a lawsuit (if they knew your company owned the car). I have no comments on whether you’d be personally liable.

A couple of my thoughts on umbrella policies from my previous research:
You’ll probably want to make sure there are no gaps that the umbrella doesn’t cover, but that the homeowners does (most likely an issue if you use a different insurer)
If you use a different insurer you need to make sure you notify the umbrella insurer of any changes to the underlying other policies. This could be problematic if you’re using the company’s auto insurance to qualify since it’s possible you won’t be notified of a change.
In many states insurance companies won’t and aren’t allowed to cover punitive damages.

Umbrella insurance extends the base insurance. If you have enough personal assets to worry about umbrella insurance, I don’t think you should put your faith in your employer that they have enough insurance to completely cover you - or that someone filing a lawsuit might go after your assets via another angle.

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Liability and negligence laws and cases vary from state to state, but you generally want to insure your net worth. How that’s done varys too, but if you own the assets, it’s generally accommodated through an umbrella policy (that requires underlying liability be insured with the same company). The umbrella shields everything you own, but it only extends the underlying coverage.

Your biggest exposure will be defending suits brought against you. Secondary risk is a judgement. You always have to pay to defend. If you lose, you may have to pay a judgement and the other side or sides’ legal fees.

Deeper pockets is relative, and don’t place false security in the Fortune 100 status. Many of them self-insure. If they have outside insurance, it’s often in the form of re-insurance or excess commercial (not personal) liability. They also have in-house counsel, so it usually costs them nothing extra to prosecute or defend suits.

Also, umbrella coverage may not be what you need – you may need a simpler form of excess liability coverage on the company-owned vehicle. For that, I’d seek a coverage extension or rider from the company or the company’s insurer, or both.

In any case, do get with an experienced insurance agent or broker (preferably) who understands the laws where you live and can protect your net worth appropriately.

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Many umbrella policies will cover situations not covered by homeowner’s policies.

When determining the amount of insurance you should also consider future earning potential. In other words, just because you have no or limited assets doesn’t mean you don’t need a liability policy.

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My suggestion is you purchase a non -owned auto policy. Its like a auto policy but the declaration page doesnt identify any auto as as insured auto. I had to do this because I had a company car in Florida. My company didnot provide u/m or uim on the company car. My concern was if I was a pedestrian and injured and not in the course and scope of employment where would I place a claim? I stacked my umbrella against the homeowners/and non owned auto policy. It worked out . I am insured with State Farm. Your agent needs to look to his/her manager or homeoffice underwriter

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One comment that needs to be said is that umbrella insurance is NOT standardized. They are all different. If you are in the market for it, and care that specific situations are covered, this is one time that an experienced insurance broker is almost a requirement. For example, I have AAA which is basically a cheap extension of the base insurance. However, Chubb and other premium insurance may cover things like defamation, doing charity work, having boats and pools, and other kinds of liability not covered by the base insurance.

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I echo this advice.
Living in NYC, I don’t own a car, but rent one quite frequently. Non-owned auto policy is about $100 a year - no brainer. And then I had no problems getting an umbrella insurance on top.

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Hi Dmitri
Could you please share which company you used to buy insurance for $100 a year. I also live in NYC. I was quoted a much higher rate by my insurance broker.

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I currently have RLI as my carrier - homeowners and vehicle insurance are all different carriers. My independent broker is the one that arranged it. I’ve carried RLI for the past 5 years and had a recent hike of about 25%. My yearly premium for a $1MM policy was about $160, but this year was $210.

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Congrats on finding a seemingly decent broker. I’ve had umbrella insurance for almost 30 years and never run across a comany that would provide umbrella coverage without also having all of the other coverages, and with minimums on those policies. Of course, once I was told enough times that it couldn’t be done, I didn’t try very hard. :slight_smile:
I’ve had Cincinnati, Safeco, and Chubb. None of them would provide umbrella coverage unless they also had the underlying coverages.

Thanks for mentioning this. Link for the curious: https://www.rlicorp.com/personal-umbrella-policy

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Just out of curiosity, I did a quote with RLI and they came up about the same as our current policy with Erie ($270 for $2M).

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That seems like an semi-decent quote if they don’t require being the carrier on your other policies.

I got original advice from https://www.flyertalk.com/forum/hertz-gold-plus-rewards/1406988-carless-new-yorker-needs-car-insurance-rentals-only-3.html

So I used https://campbellsolberg.com/ to buy a policy from Travelers. It was a stand-alone non-owned auto policy. Last year they suggested and I switched to Hanover, where non-owned auto policy was not stand-alone, but came as an additional rider on the homeowners/renters policy with higher limits than Travelers and for just $97.

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Good quote. Mine was significantly more for 1M coverage. Still cheaper than my current auto & home insurer.

P.S. Does anyone know how you are supposed to answer the acreage question? My home sits on > 1 acre. Do I list 1 or 0? It was unclear to me if this refers to primary home acreage or additional, unrelated land. Maybe I am overthinking it.

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