Fido is a much-loved, rather timid lab-mix who enjoys taking naps on the driveway while his owner mows the lawn.
Fido watched from eight feet away as his neighbor, a 39 year-old man, showed off his rollerblading skills to his kids. The man wiped out on the sidewalk in front of Fido's house and broke his leg. He required surgery, costing around $35,000 in medical costs and $18,000 in lost wages.
Fair or not, the man brought a lawsuit against Fido's owner, suing for $220,000 in damages. He alleged that Fido had caused the accident by getting in his way, despite multiple witnesses to the contrary.
But Fido's owner was lucky- a jury vindicated Fido. However, lawsuits such as these can easily exceed the limits on a homeowner policy, leaving the insured responsible for the remainder. An umbrella policy would pickup that remainder by giving you an extra $1 million to $5 million (or more) in coverage. Something to consider: an umbrella policy will also pay your defense costs, even when the lawsuit is frivolous.
We can understand why you'd think you could push umbrella coverage down your list of priorities. After all, you've got home and auto policies to cover you.
Unfortunately, lawsuits have become a common occurrence. Many times, they result in large court awards that can have long-term financial impact and exceed the coverage you currently have. And lawsuits like these can come from unlikely sources, such as our furry friends.
Pets can even get us into a liability suit in other ways, too. According to the Center for Disease Control and Prevention, 4.7 million people are bitten by dogs each year, with half of those occurring on the owner's property. Dog bites are the most common homeowner's liability claim. According to the Insurance Information Institute, they account for about a third of homeowner's claims, which only cover limited damages.
Whichever scenario you think is more likely, if you have a companion like Fido in your home, we recommend that you talk about liability and umbrella insurance with your insurance agent or the insurance professionals at CLH.