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Umbrella Insurance Calculator

How much excess liability cover to carry, based on what could actually be at risk.

Your numbers

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Result

Cover worth considering $2,000,000
Assets and future income at risk $1,550,000
Gap above the underlying limits $1,637,500
Estimated annual premium $500
Cost per million $250
With $1,550,000 of assets and future income exposed, roughly $2,000,000 of umbrella cover is worth discussing, at around $500 a year. Umbrella is unusually cheap per dollar of protection.

An estimating tool, not insurance advice and not a quote. Underwriting sets real premiums on factors no calculator sees. What cover is appropriate is a question for a licensed broker. Umbrella cover sits above your auto and home liability and requires those underlying policies to carry minimum limits, so raising the umbrella often means raising them first. Future income is included because judgments can be satisfied from earnings over time, not only from present assets. Whether and how much to carry is a conversation for a broker who knows your circumstances.

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Questions

About this calculator

Why include future income?

Because a judgment exceeding your cover can be satisfied from earnings for years. Protecting only present net worth understates what is genuinely at risk.

Why is umbrella cover so cheap?

Because it only pays after the underlying policies are exhausted, which happens rarely. It is inexpensive protection against the low-probability, high-severity event insurance exists for.

The formula

exposure = net worth + several years of income, adjusted for risk factors, less the lowest underlying limit

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