Insurance: Are You Adequately Covered?
Are you in a high risk group? You could be, and not realize it. We're often so busy taking care of our families and doing our jobs that our circumstances change without our even noticing. For instance, that child who was just a toddler yesterday is asking to borrow your car today. Now you are in a high risk category. Teenage drivers are involved in a large number of accidents for their age group, putting both them and you at risk. Elderly drivers also have higher than average risk, mostly from the slowing of reflexes and deterioration of vision and hearing. If you have a teenager or a parent in your home, driving your car, you need to examine your insurance coverage. There is a little known but very important fact about insurance: if there is a judgment against you that exceeds your policy limits, the excess is your personal responsibility! So, if your teenager causes an accident in which there are deaths or multiple injuries, you could lose everything you have saved over the years. Driving isn't the only risk factor, however. You can also be sued if a visitor falls on your icy sidewalk, if your dog bites someone, if your stereo is too loud, or for hundreds of other reasons you can't even imagine. Any time there is a judgment against you not covered by your insurance, you must pay out of your own pocket. Review your basic coverage periodically. You should have automobile insurance if you drive, and homeowner or renter's insurance for your property. Consider the possibility that you might need umbrella insurance, too. You can purchase an umbrella policy from your car or homeowners insurance company to give you extra coverage above (hence "umbrella") your basic policy limits. One to ten million dollars is not unreasonable, depending on how many risk factors are present. Remember, you can only get the coverage before you need it. After the accident, it's too late. Written by Caryn S. Lennon, J.D. Caryn S. Lennon is an attorney in Washington, D.C. She can be reached at 202-429-2089.
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