Buy an umbrella policy and reduce your bodily injury liability coverage to the barest minimum stipulated by law. The more substantial your asset, they more this recommendation is true in your case.
What do you buy bodily injury liability coverage for? It’s to take care of passengers involved in an accident along with the other driver. If you don’t have coverage like this, your assets could be used to compensate victims in accidents.
You are, however, urged to opt for an umbrella policy because even the most extensive liability coverage within an auto insurance policy wouldn’t be adequate if you’re at fault in a fatal accident. This means that your personal assets will be liable if your liability coverage cannot handle the result bills and damages incurred.
But if you have an umbrella policy, you’re almost certain that it can handle the most extreme case. Furthermore, you not only save on auto insurance but you also have coverage that takes care of every other kind of liability issue that may arise in your life.
Price-wise, you get much more coverage per premium dollar with an umbrella policy…
If a 35-year old man who lives in New York City wants to raise his bodily injury to $100K/$300K from $25K/$50K, his rate will increase by $300! However, with an umbrella policy, he’ll spend less than that to get $1 million worth of coverage.
And if he chooses to raise the coverage amount of his umbrella policy to $2 million dollars, he’ll only have to pay only $75 more. After the $2 million mark, he’ll only need to add $50 to his rate per $1 million extra coverage amount. If you want more for less then an umbrella policy will do you more good.
Now, go ahead and drop your liability coverage to the minimum. But make sure your umbrella policy is in force before you do that.