Conference nyoss1::market_investing

>I want to save money on option 5 of my MASS auto insurance by purchasing an

    For those of us who don't live in Mass, can you briefly explain what
    "option 5" is?

It is 'Optional bodily injury to others'. I think it also covers medical and
income losses due to accident. In case of death, I don't know how they
come up with loss. 'Others' refers to anyone other than the
owner of the Vehicle.

Without this insurance, the party involved will be after your home if you
are a home owner.

> It is 'Optional bodily injury to others'. ...
>Without this insurance, the party involved will be after your home if you
>are a home owner.
      
      Well, this makes sense. What the insurer is saying is that to keep
      the umbrella policy as what its supposed  to  be  --  coverage  of
      "last resort" -- you must carry certain minmum "regular" liability
      limits on your home and auto insurance.
      
      We  have  a  umbrella  policy in New Hampshire.  It requires us to
      carry certain liability  minimums  on  our  auto  and  homeowner's
      policies.   Interestingly  enough,  although  the requirements are
      generally higher that most people might purchase as  a  matter  of
      course,  they  are  lower  than  I'd  want  if  we didn't have the
      umbrella.  We've set  the  limits  on  our  auto  and  homeowner's
      policies  to the minimum requirement of the umbrella policy.  This
      provides what I consider an optimal coverage/price ratio.
      
      

Metpay's umbrella policy in MA requires a minimum
of $300K liability on house and auto.

Gim

    I investigated umbrella liability policies last year.  I had let my
    house in Massachusetts to tenants while I was working overseas.  I had 
    home owners insurance with Metropolitan, but no automobile insurance in 
    the US.
    
    Metropolitan could not offer me an umbrella policy as indicated in
    the previous replies.  I then contacted an independent agent who stated 
    she could obtain a $1 million umbrella liability policy independent of 
    other insurances (such as automobile).  The catch was that it would be 
    extremely expensive.  I decided against such coverage, and subsequently
    sold my property. 
    
    I would suggest you contact an independent agent who can shop around
    for a policy which meets your coverage and cost requirements.

    
    I would like to bring this topic back to life ... I called METPAY and
    asked a question about my insurance and he mentioned I should consider
    a umbrella policy.  I own a house, 2 cars and have 2 kids.
    
    Was this a wise move ?  I opted for 1 million coverage.
    
    p.s. I had to up my wifes bodily injury coverage (#3 on auto policy) to
    100,000 to 300,000 coverage.  I had it on my auto.
    
    He also said I needed to add a $15/year coverage to my home policy
    (state law) ... I didn't really understand why but it was inexpensive
    and he would be sending the info.  Can someone explain what this might
    of been ?
    
    Do you have a umbrella policy and WHY ?  

re: Note 769.6 by CSCMA::BALICH 

>    I would like to bring this topic back to life ... I called METPAY and
>    asked a question about my insurance and he mentioned I should consider
>    a umbrella policy.  I own a house, 2 cars and have 2 kids.
>    
>    Was this a wise move ?  I opted for 1 million coverage.

    The purpose of an umbrella policy is to protect you from liability
    in excess of your other (house, auto) insurance limits.  Whether or 
    not it is a "wises move" depends on your net wealth -- the assets
    that you are protecting.

    I have one through Metpay.  I got it after I was the target of a BS
    lawsuit which almost went to trial.  The lawsuit opened my eyes to the
    fact that I could be sued in the future and stand to lose quite a
    lot... way beyond the coverage I had at the time.  And at a relatively
    young age, there's a lot to lose in terms of future earnings.
    
    Also, it occurred to me that, heaven forbid, some day there might be a
    situation where I'd _want_ somebody I'd hurt to be able to get a large
    settlement from my insurance company.
    
    No, the umbrella policy doesn't make my future earnings completely
    safe, nor does it guarantee somebody I've hurt a large settlement, but
    it's a step in that direction for a modest cost.

Insurance is a matter of risk management.  Look at your net worth (and future 
earnings) with the understanding that a law suit could claim the lion's share.  
Now look at your insurance coverage; the difference is your risk.

Or put another way, how much of what you have are you willing to lose?  When I 
looked at my net worth against my insurance coverage, it became obvious that I 
was at risk.  An umbrella policy turned out to be the most appropriate answer.  
About the only down side seems to be that it is not affordable unless you have 
house and car insured by the same company.  And, as with all other insurances, 
each company's "package" is differnet; shop around.

Dave

    
    Yes, my wife and I have umbrella coverage.
    
    The motivating factor for me was my being sued when I was in college
    for a car accident.  Yes, I was at fault but the claim was basically
    bogus.  When meeting with the insurance companies lawyer I made a joke
    about them taking my whole net worth  .. at the time it was about minus
    $10,000.  I was thinking like this
    
> Insurance is a matter of risk management.  Look at your net worth (and future 
> earnings) with the understanding that a law suit could claim the lion's share.  
> Now look at your insurance coverage; the difference is your risk.
    
    I was told this is incomplete.  A suit can attack your current net
    worth and it also CAN ATTACH ALL FUTURE INCOME AND INVESTMENTS.  So at
    20 my net worth was -$10,000 but my future salary stream could have been
    predicted to be about $2.0M.  For me that brought liability insurance
    into a whole new light for me.
    
    Greg
    
    
                                                       

    re .6: In my state -- Massachusetts -- I did not have to add anything to my
    home insurance policy, just my automobile policy

re .10
    
> Insurance is a matter of risk management.  Look at your net worth (and future 
> earnings) with the understanding that a law suit could claim the lion's share.  
> Now look at your insurance coverage; the difference is your risk.
    
>    I was told this is incomplete.  A suit can attack your current net
>    worth and it also CAN ATTACH ALL FUTURE INCOME AND INVESTMENTS.  So at
>    20 my net worth was -$10,000 but my future salary stream could have been
>    predicted to be about $2.0M.  For me that brought liability insurance
>    into a whole new light for me.

Is that not what I said - or at least strongly implied - with the words "... 
and future earnings..." ?

Dave    
                                                       

    
> Is that not what I said - or at least strongly implied - with the words "... 
> and future earnings..." ?
    
    umm ... ahh ... hmmm ... well yes, I missed it when I first read it.
    Sorry about that.
    
    Greg
    

Your assets and potential future income are not the only factors in deciding
whether to buy an umbrella -- or how much of an umbrella to buy. Some actions
make a person more likely to be sued. Examples? Owning rental property, or
serving as a volunteer member of an organization's board of directors.

Note I did NOT say "serving on a for-profit company's board of directors."
A personal liability umbrella generally does not cover liability associated
with that kind of activity.

I served on a large non-profit's Board when the organization was on the verge
of bankruptcy. In fact, part of why I ran for the seat was to help pull it
back into financial viability. But volunteer groups typically have few hard
assets -- ours would have barely made a dent in the overdue bills. If the
organization had filed for bankruptcy, creditors could have legally pursued
personal assets of members of the board to get the money due for them. The
corporate shield has a lot of holes in it, and the board's Errors & Omissions
policy would not have covered the debt, but my liability umbrella policy
would have covered my share (but only because it was volunteer service).

Read the policy wording carefully. Most draw the line in a similar place. Also
pay attention to whether you are allowed to tell anyone that you hold the
policy. Some policies are valid only as long as you keep them a secret between
you and the insurer; the reasoning is that if people become aware that you're
covered, nuisance lawsuits become more likely.

Bonnie D. Huval

P.S. -- I have been out of my volunteer service for a decade, so I can speak up.