Insurance Question - Umbrella Liability Policy?

[Ted Summey]

For most of my professional career I have carried an Umbrella Liability Policy with a professional coverage rider. The policy covers both personal and professional liability. Considering I occasionally use my tractor to do things like fix the pastor's garden, mow hay for a neighbor etc and that requires driving the tractor on the road, should I maintain this policy? None of the jobs are for pay, we either swap work or it is just to help a friend. The policy isn't expensive on an annual basis.

 

[aczlan]

I carry an umbrella policy, the savings on my auto policy paid for ~1/3 of it and it wasn't too bad (under $150/year IIRC). Well worth it in case something happens.

Aaron Z

 

[dave1949]

Ted, as I recall, a typical homeowner's policy covers non-commercial use of your tractor as long as it is on your property.

When I had my tractor insured, it was called an "Inland Marine" policy. That was to satisfy CNH Financial and to cover me when hauling the tractor from one property to another.

 

[sixdogs]

Absolutely keep the umbrella policy.

 

[Ted Summey]

There have been a couple of threads recently, one on a driveway ditching side job and one on a debacle when a fellow member here towed a neighbor's tractor as a favor, both of which got me thinking about this policy. I would hate to give up helping friends or volunteering my tractor services because of the dangers of "what might happen." Especially considering most of what we worry about never happens anyway. The umbrella policy would help provide a bit of comfort. Again, I don't operate my tractor for a "fee for service basis."

I'm actually beginning to think I might need to up the coverage. My assets have increased and have increased in value since the original policy was written.

BTW retirement isn't far off so the professional liability part will need to go away then anyway.

 

[creekbend]

If it were ME, I would continue the Coverage. Just my thoughts.

 

[QRTRHRS]

I would speak with my agent and discuss my activities and needs.

 

[Jtschnel]

Ted,

You mention that your assets have increased. Unfortunately, the more your assets increase the more you're seen as a lottery ticket by litigious and unscrupulous individuals. Don't take a chance, and make sure you've got enough coverage.

 

[CurlyDave]

When looking at umbrella policies, don't just take the first one offered. My previous agent, suggested a $1 million policy, when I asked and was not very willing to consider anything larger. This was one factor in getting a new agent, with the same company. The new agent was very willing to consider more and a $5 million policy is not much more costly than the $ 1 million policy.

The first agent felt that I should relate the size of the policy to my assets. I felt rather strongly that I should relate the size of the policy to the size of a potential judgement against me, rather than my assets. Plus if I ever have a claim, the larger the policy, the better the legal team the insurance company will provide to assist me. Insurance companies all have many lawyers available, and some are better than others. The larger their potential loss, the better the legal help they send.

 

[sixdogs]

Excellent advice here. When we upgraded coverage, larger amounts didn't cost that much more. When we switched to a "farm" policy for equipment coverage, I think an umbrella policy with 3x the old coverage cost nearly the same as the old 1x coverage under the old policy.

When looking at umbrella policies, don't just take the first one offered. My previous agent, suggested a $1 million policy, when I asked and was not very willing to consider anything larger. This was one factor in getting a new agent, with the same company. The new agent was very willing to consider more and a $5 million policy is not much more costly than the $ 1 million policy.

The first agent felt that I should relate the size of the policy to my assets. I felt rather strongly that I should relate the size of the policy to the size of a potential judgement against me, rather than my assets. Plus if I ever have a claim, the larger the policy, the better the legal team the insurance company will provide to assist me. Insurance companies all have many lawyers available, and some are better than others. The larger their potential loss, the better the legal help they send.