Asset Management Discussion Post 8 - Coursework Example

Asset Management Discussion Post 8 Lecturer An Umbrella insurance is considered as an extra liability insurance that plays a role in protecting an individual from major claims, as well as lawsuits. This way, it provides protection against an individual’s assets and their future. The net worth of $500,000 an individual has is considered as one of the factors for consideration before getting an umbrella insurance. However, according to Dave Ramsey, the net worth is not a key consideration. It is essential for individuals to get Umbrella insurance as it gives an additional insurance layer above the home insurance and auto insurance liability coverage, for example, against additional liability coverage of auto, homeowners as well as boat insurance policies (Fox Business, 2013).

It is also crucial as it provides coverage for claims that exclude other liability policies such as false arrest, rental unit’s liability, slander and libel liabilities. The insurance protection has been designed to kick on in cases where the liability of the other policies is exhausted (Mathias, Shugrue, Marrinson & Struck 2006).Individuals should not consider their net worth or other auto and homeowners insurances that they may have to cover some of the situations. Rather, Umbrella insurance is crucial as it insurer’s them beyond and above the other policies limits and will cover against situations that are never covered in other types of policies (Daily Finance, 2013).

According to Breuer (2005), most of the umbrella insurances are associated with car accidents but also offer protection against home accidents. An example is when an individual falls down the stairs and sues you for poor construction or when the balcony collapses during a house party causing injury. Individuals will opt for umbrella insurances as a result of such instances or because they have a pool or property that may cause harm to someone and fear the consequences that will result from the harm or damage.

ReferencesBreuer, M. (2005). Multiple losses, ex ante moral hazard, and the implications for umbrella policies. Journal of Risk and Insurance, 72, 525–538. doi:10.1111/j.1539-6975.2005.00136.xMathias, J. H., Shugrue, J. D., Marrinson, T. A., & Struck, D. J. (2006). Insurance coverage disputes. New York: Law Journal Press.Fox Business. (2013). When do we need umbrella insurance. Retrieved from http://www.foxbusiness.com/personal-finance/2013/11/05/when-do-need-umbrella-insurance/Daily Finance.

Umbrella Insurance policies extra protection. Retrieved from http://www.dailyfinance.com/2013/07/05/umbrella-insurance-policies-extra-protection/