Personal Finance (Not Investing) • umbrella insurance tiered pricing choices

I have a $3m umbrella insurance policy through GEICO. I spoke to them on the phone, and their latest quotes are:

• $2m umbrella coverage for roughly $560/year
• $3m umbrella coverage for roughly $1.1k/year (up from about $850/year)
• $5m umbrella coverage for roughly $1.8k/year

I have seen some people suggest that the umbrella policy should cover one's net worth. Others argue that $2-3m coverage is sufficient regardless of net worth since it's rare for people to sue for higher than that. I have no experience with this. At what point does the annual cost start to factor into the decision? At what point does saving $600/year become penny-wise pound-foolish?

My portfolio is roughly $5.8m in taxable, $0.9m in 401k + Roth, and my home equity is $450k.

Should I stay put at $3m? Or go up to $5m (or even higher)? Or go down to $2m?

P.S., I also don't understand the big leap in price from $2m coverage to $3m coverage. The price practically doubles. Why?

Statistics: Posted by djm2001 — Mon Feb 26, 2024 2:22 pm — Replies 0 — Views 27

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