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If you have a high net worth, buying car insurance can be a different experience than for most people. You might need a policy with high liability limits that covers all of your assets in case of a lawsuit, or even an umbrella policy. And if you have a special luxury car you might want an agreed value policy.
If you’re in a severe accident, the injured party will likely seek as much compensation as possible, which could include compensation for medical bills, lost wages and pain and suffering.
If your car insurance liability limits are too low to cover the other person’s injuries, court fees and any settlement, then you’ll be responsible for paying the difference with your own money or assets. Plus you might have a higher risk of a lawsuit if you drive a luxury car, which could be a target for insurance scammers.
Most standard insurance companies offer a maximum of $500,000 liability limits on their auto policies, with some offering up to $1 million or $10 million from some specialty insurers. If you need even higher limits, consider buying an umbrella policy, which would cover you up to $10 million.
A personal umbrella policy adds additional coverage to what you carry on your home and auto policies. The standard umbrella is $1 million in coverage, which means you’ll have an extra $1 million if your other insurance limits don’t fully cover the cost of the accident or lawsuit. Most insurance companies offer up to $5 million umbrella policies, but higher limits are available.
For example, if you have a $250,000 bodily injury liability limit on your auto policy and you were at fault for an accident over that limit, your $250,000 car insurance coverage would pay out first, and then you would have up to $1 million from your umbrella policy to cover the rest.
Personal umbrella policies typically cost between $150 and $300 a year, but could be more if you opt for higher limits, have young drivers on your policy, have several vehicles or own multiple properties. You’ll typically have to carry a minimum level of coverage on your home or auto policies to qualify for an umbrella policy.
The national average for car insurance in the US is around $1,300 a year. Your car insurance rates depend on many factors, such as:
There’s a few things you can do to lower your auto premiums, even if you increase your liability limits.
As a wealthy driver you’ll want to be sure you have the proper insurance, here’s what to keep in mind:
Obtaining the proper insurance coverage when you’re wealthy includes having enough liability insurance to cover your assets. This could mean comparing specialty car insurance, an umbrella insurance policy or agreed value policies.
Compare your car insurance options to find one that’s best suited for you.
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