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My net worth is around 1.4 million dollars. I read somewhere that I should get an umbrella policy. Currently, I have basic car insurance as shown below.

Car 1 Coverage:

Bodily Injury Coverage Limit Per Accident $60,000 Limit Per Person $30,000

Property Damage Coverage Limit Per Accident $25,000

Car 2 Coverage:

Bodily Injury Coverage Limit Per Accident $60,000 Limit Per Person $30,000

Property Damage Coverage Limit Per Accident $25,000

Other Than Collision Deductible Deductible $500

Collision Coverage Deductible $500

Uninsured/Underinsured Motor Vehicle Coverage Limit Per Accident $60,000 Limit Per Person $30,000 Uninsured/Underinsured Property Damage (under Uninsured/Underinsured BIPD) Coverage Limit Per Accident $25,000

Personal Injury Protection Coverage Aggregate Limit $2,500

Car insurance + home is through State Farm.

Should I increase bodily injury coverage? To how much and on which cars? Also how much should I get the umbrella policy worth and how much does it usually cost per month?

user19037628
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1 Answers1

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I'd consider the nature of your net worth and your locale's laws. An umbrella policy may not be necessary. Many states will not allow a primary home or retirement plan to be seized in a civil action. So if you have a home with 800K equity, and a 500K 401K, and a 100k between a brokerage and savings, really only 100K needs to be protected.

Its worth consulting a lawyer over this.

A great first step is to increase your liability coverage on both cars to the max. And I would recommend doing this, today, for both bodily and property. This just makes sense for a person with some kind of wealth.

xuhdev
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Pete B.
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