Who has needed to use their umbrella insurance?

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michaeljc70
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Re: Who has needed to use their umbrella insurance?

Post by michaeljc70 » Wed Sep 20, 2017 12:11 pm

boglerdude wrote:
Sat Jun 18, 2016 12:41 am
"When a judge/jury enters a verdict for damages in a negligence case, he/they do not know how much wealth the Defendant has"

Every $2MM+ judgement Ive heard about has been levied against a defendant who has substantial assets, like a corporation.

In other words I havent seen a multi-million dollar judgement against someone middle class who will never be able to pay it.

Not sure what this means, if the size of the awards are supposed to be "asset blind"
You don't need assets. What if you have a job? They can possibly garnish those wages. The award can definitely be higher than your NW. As mentioned, some judgments can be discharged through bankruptcy though, so that has to be taken into account from a practical perspective. If you hit a Cardiologist making $700k a year in a Bentley and he can no longer work, they most likely aren't going to sue you for only $1M because that is your NW.

chocolatemuffin
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Re: Who has needed to use their umbrella insurance?

Post by chocolatemuffin » Wed Sep 20, 2017 12:39 pm

Bfwolf wrote:
Thu Jun 16, 2016 5:05 pm
My Mom was involved in an incident with my brother's dog that she was walking....long story short the dog knocked over a lady who broke her knee. The litigation is ongoing, but the woman is asking for something like $750,000 so the umbrella insurance may come into play. But I'm guessing it probably will settle for an amount below where the umbrella insurance kicks in.
Since this is not related to home or auto, there is no primary insurance, right? In this case, at what amount will the umbrella insurance kick in?

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dm200
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Re: Who has needed to use their umbrella insurance?

Post by dm200 » Wed Sep 20, 2017 3:36 pm

Having recently inherited an IRA that is in the high six figures, I just upped my umbrella to $2 million, precisely because of this, though admittedly I could have actually done the research first to determine whether my state protects inherited IRAs the same as "regular" retirement accounts.
Depending on state law, even "regular" IRAs may be subject to civil judgments. I speak from a difficult experience. I have over $300,000 taken from a regular IRA on a civil judgment.

Swimmer
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Re: Who has needed to use their umbrella insurance?

Post by Swimmer » Wed Sep 20, 2017 6:25 pm

dm200 wrote:
Wed Sep 20, 2017 3:36 pm
Having recently inherited an IRA that is in the high six figures, I just upped my umbrella to $2 million, precisely because of this, though admittedly I could have actually done the research first to determine whether my state protects inherited IRAs the same as "regular" retirement accounts.
Depending on state law, even "regular" IRAs may be subject to civil judgments. I speak from a difficult experience. I have over $300,000 taken from a regular IRA on a civil judgment.


FWIW, I checked with our attorney who tells me that in Florida, IRAs are safe as well as homesteaded home. Didn't ask about inherited IRAs.

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Steelersfan
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Re: Who has needed to use their umbrella insurance?

Post by Steelersfan » Wed Sep 20, 2017 7:57 pm

StevieG72 wrote:
Mon Sep 18, 2017 5:14 pm
Interesting recap of some actual claims....

http://www.galleninsurance.com/wp-conte ... Policy.pdf
I wonder how many policies were covered and over how many years it took to find those 10 cases?

Where they all that firm's or did they go scouting for every claim the could find to come up with the list?

freebeer
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Re: Who has needed to use their umbrella insurance?

Post by freebeer » Wed Sep 20, 2017 8:04 pm

jwhitaker wrote:
Thu Jun 16, 2016 1:24 pm
...The loss ratio on umbrella really is in that 20% to 50% range. So it's higher profit margin than your homeowners or auto (those are more like 60%+) but it's reasonable.
Why is 20% reasonable vs 60% plus for homeowners and auto? Maybe not quite ""scam" but not exactly a great deal for the consumer...

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unclescrooge
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Re: Who has needed to use their umbrella insurance?

Post by unclescrooge » Wed Sep 20, 2017 8:17 pm

BSA44 wrote:
Thu Jun 16, 2016 10:03 am
...New Yorkers are the true hidden danger.
If there was insurance against New Yorkers, I'd buy that. :mrgreen:

BanquetBeer
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Re: Who has needed to use their umbrella insurance?

Post by BanquetBeer » Wed Sep 20, 2017 8:34 pm

Most people here talk about $1mm coverage... isn't it the coverage for $450k to $1000k (liability coverage of $550k between these amounts). That makes it 2x as expensive.

Probably still worth it but this was confusing me.

knightrider
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Re: Who has needed to use their umbrella insurance?

Post by knightrider » Thu Sep 21, 2017 8:40 am

StevieG72 wrote:
Mon Sep 18, 2017 5:14 pm
Interesting recap of some actual claims....

http://www.galleninsurance.com/wp-conte ... Policy.pdf
I skimmed through these and I doubt they are real. They seem made up. Most are a case of being in the wrong place in the wrong time. In my opinion to win a judgement you would have to prove gross negligence.

JBTX
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Re: Who has needed to use their umbrella insurance?

Post by JBTX » Thu Sep 21, 2017 9:11 am

LarryAllen wrote:
Thu Jun 16, 2016 9:20 am
JW-Retired wrote:
seanmerron wrote:
Is it a true statement that Retirement accounts are protected anyways so really only need it to protect taxable account monies? I hear lawyers know how much coverage you have and will go for all of it.
Not true. Protection varies with your state's law. A long time poster here had his IRA drained as a result of a business lawsuit judgement.
JW
I could be wrong but I believe ERISA (federal governed) plans like 401ks do have creditor protection and non-ERISA (state governed) plans like IRAs depend on state law. Also, it depends on if it's your 401k/IRA or an inherited one (i.e. it was your parent's IRA which may have been protected by state law but it became your inherited IRA it may have lost that protection). I am not an asset protection expert so just repeating what I have heard over the years.

Also, as to the question of having an umbrella it's all about sleeping at night if you ever are sued for a lot of money.
This was my understanding too but I'm not a lawyer.

I'm guessing what that means is a lawsuit can't attach a 401k. But you still in theory would owe the lawsuit money. They just can't force you to liquidate your 401k. I'd assume the only way to get permanent protection is to declare bankruptcy at which point your 401k is protected from creditors.

My understanding on IRA is state dependent. I have heard TX has some protections on such retirement accounts.

Again I'm not an expert here and could be substantially wrong on some of the above.

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dm200
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Re: Who has needed to use their umbrella insurance?

Post by dm200 » Thu Sep 21, 2017 9:50 am

JBTX wrote:
Thu Sep 21, 2017 9:11 am
LarryAllen wrote:
Thu Jun 16, 2016 9:20 am
JW-Retired wrote:
seanmerron wrote:
Is it a true statement that Retirement accounts are protected anyways so really only need it to protect taxable account monies? I hear lawyers know how much coverage you have and will go for all of it.
Not true. Protection varies with your state's law. A long time poster here had his IRA drained as a result of a business lawsuit judgement.
JW
I could be wrong but I believe ERISA (federal governed) plans like 401ks do have creditor protection and non-ERISA (state governed) plans like IRAs depend on state law. Also, it depends on if it's your 401k/IRA or an inherited one (i.e. it was your parent's IRA which may have been protected by state law but it became your inherited IRA it may have lost that protection). I am not an asset protection expert so just repeating what I have heard over the years.

Also, as to the question of having an umbrella it's all about sleeping at night if you ever are sued for a lot of money.
This was my understanding too but I'm not a lawyer.

I'm guessing what that means is a lawsuit can't attach a 401k. But you still in theory would owe the lawsuit money. They just can't force you to liquidate your 401k. I'd assume the only way to get permanent protection is to declare bankruptcy at which point your 401k is protected from creditors.

My understanding on IRA is state dependent. I have heard TX has some protections on such retirement accounts.

Again I'm not an expert here and could be substantially wrong on some of the above.
One key (and often misunderstood, even by attorneys) factor is the difference between protection in bankruptcy and protection from civil judgments (when no bankruptcy).

JBTX
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Re: Who has needed to use their umbrella insurance?

Post by JBTX » Thu Sep 21, 2017 10:26 am

dm200 wrote:
Thu Sep 21, 2017 9:50 am
JBTX wrote:
Thu Sep 21, 2017 9:11 am
LarryAllen wrote:
Thu Jun 16, 2016 9:20 am
JW-Retired wrote:
seanmerron wrote:
Is it a true statement that Retirement accounts are protected anyways so really only need it to protect taxable account monies? I hear lawyers know how much coverage you have and will go for all of it.
Not true. Protection varies with your state's law. A long time poster here had his IRA drained as a result of a business lawsuit judgement.
JW
I could be wrong but I believe ERISA (federal governed) plans like 401ks do have creditor protection and non-ERISA (state governed) plans like IRAs depend on state law. Also, it depends on if it's your 401k/IRA or an inherited one (i.e. it was your parent's IRA which may have been protected by state law but it became your inherited IRA it may have lost that protection). I am not an asset protection expert so just repeating what I have heard over the years.

Also, as to the question of having an umbrella it's all about sleeping at night if you ever are sued for a lot of money.
This was my understanding too but I'm not a lawyer.

I'm guessing what that means is a lawsuit can't attach a 401k. But you still in theory would owe the lawsuit money. They just can't force you to liquidate your 401k. I'd assume the only way to get permanent protection is to declare bankruptcy at which point your 401k is protected from creditors.

My understanding on IRA is state dependent. I have heard TX has some protections on such retirement accounts.

Again I'm not an expert here and could be substantially wrong on some of the above.
One key (and often misunderstood, even by attorneys) factor is the difference between protection in bankruptcy and protection from civil judgments (when no bankruptcy).
So in which do 401ks and some IRAs fall?

ResearchMed
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Re: Who has needed to use their umbrella insurance?

Post by ResearchMed » Thu Sep 21, 2017 10:42 am

JBTX wrote:
Thu Sep 21, 2017 10:26 am
dm200 wrote:
Thu Sep 21, 2017 9:50 am
JBTX wrote:
Thu Sep 21, 2017 9:11 am
LarryAllen wrote:
Thu Jun 16, 2016 9:20 am
JW-Retired wrote: Not true. Protection varies with your state's law. A long time poster here had his IRA drained as a result of a business lawsuit judgement.
JW
I could be wrong but I believe ERISA (federal governed) plans like 401ks do have creditor protection and non-ERISA (state governed) plans like IRAs depend on state law. Also, it depends on if it's your 401k/IRA or an inherited one (i.e. it was your parent's IRA which may have been protected by state law but it became your inherited IRA it may have lost that protection). I am not an asset protection expert so just repeating what I have heard over the years.

Also, as to the question of having an umbrella it's all about sleeping at night if you ever are sued for a lot of money.
This was my understanding too but I'm not a lawyer.

I'm guessing what that means is a lawsuit can't attach a 401k. But you still in theory would owe the lawsuit money. They just can't force you to liquidate your 401k. I'd assume the only way to get permanent protection is to declare bankruptcy at which point your 401k is protected from creditors.

My understanding on IRA is state dependent. I have heard TX has some protections on such retirement accounts.

Again I'm not an expert here and could be substantially wrong on some of the above.
One key (and often misunderstood, even by attorneys) factor is the difference between protection in bankruptcy and protection from civil judgments (when no bankruptcy).
So in which do 401ks and some IRAs fall?
At least part of that is state-specific; both of them might be.
And does ERISA-or-not status make a difference for the 401k/403b?
(At least, that used to be the case, such as the reason not to commingle IRA's rolled over from ERISA plans with regular IRA's.)

RM
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JBTX
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Re: Who has needed to use their umbrella insurance?

Post by JBTX » Thu Sep 21, 2017 10:58 am

ResearchMed wrote:
Thu Sep 21, 2017 10:42 am
JBTX wrote:
Thu Sep 21, 2017 10:26 am
dm200 wrote:
Thu Sep 21, 2017 9:50 am
JBTX wrote:
Thu Sep 21, 2017 9:11 am
LarryAllen wrote:
Thu Jun 16, 2016 9:20 am


I could be wrong but I believe ERISA (federal governed) plans like 401ks do have creditor protection and non-ERISA (state governed) plans like IRAs depend on state law. Also, it depends on if it's your 401k/IRA or an inherited one (i.e. it was your parent's IRA which may have been protected by state law but it became your inherited IRA it may have lost that protection). I am not an asset protection expert so just repeating what I have heard over the years.

Also, as to the question of having an umbrella it's all about sleeping at night if you ever are sued for a lot of money.
This was my understanding too but I'm not a lawyer.

I'm guessing what that means is a lawsuit can't attach a 401k. But you still in theory would owe the lawsuit money. They just can't force you to liquidate your 401k. I'd assume the only way to get permanent protection is to declare bankruptcy at which point your 401k is protected from creditors.

My understanding on IRA is state dependent. I have heard TX has some protections on such retirement accounts.

Again I'm not an expert here and could be substantially wrong on some of the above.
One key (and often misunderstood, even by attorneys) factor is the difference between protection in bankruptcy and protection from civil judgments (when no bankruptcy).
So in which do 401ks and some IRAs fall?
At least part of that is state-specific; both of them might be.
And does ERISA-or-not status make a difference for the 401k/403b?
(At least, that used to be the case, such as the reason not to commingle IRA's rolled over from ERISA plans with regular IRA's.)

RM
http://www.investopedia.com/articles/in ... wsuits.asp

The above link was informative. My interpretation of it is ultimately you have to file bankruptcy to get the protection. They did note that for IRAs some state are better than others. CA is bad, Tx is good.

jwhitaker
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Re: Who has needed to use their umbrella insurance?

Post by jwhitaker » Tue Oct 03, 2017 1:42 pm

freebeer wrote:
Wed Sep 20, 2017 8:04 pm
jwhitaker wrote:
Thu Jun 16, 2016 1:24 pm
...The loss ratio on umbrella really is in that 20% to 50% range. So it's higher profit margin than your homeowners or auto (those are more like 60%+) but it's reasonable.
Why is 20% reasonable vs 60% plus for homeowners and auto? Maybe not quite ""scam" but not exactly a great deal for the consumer...
20% is probably just the company getting lucky, and not having many claims. That isn't the industry average, which would be toward the top of my 20 to 50% range. Take this in the context of title insurance, where less than $10 of your $1,000 premium is used to pay or settle claims (so 1%), and $900 or more goes to sales commission. THAT is a scam.

Also, umbrella has a much higher risk than auto. I can't have a $1M damage to my Camry, but I could have a $1M umbrella claim, plus the ins co promises to pay for my legal defense. Considering it is only $100 to $200 a year that is a fair trade-off to me, based on my risk aversion, even if the insurance co has a high profit margin.

downshiftme
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Re: Who has needed to use their umbrella insurance?

Post by downshiftme » Tue Oct 03, 2017 3:23 pm

I have used mine, but only indirectly.

A scammer hit my parked car in a public place, then claimed I hit him and caused a neck (like whiplash) injury. The amount claimed was within my Auto insurance limits, but because I also had umbrella, the insurance company sent a top team of lawyers to defend the claim and it was quickly tossed out of court.

This one incident alone makes me more than happy with my umbrella coverage and I plan to keep it forever, with occasional increases in limits due to inflation.

OnTrack
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Re: Who has needed to use their umbrella insurance?

Post by OnTrack » Wed Oct 04, 2017 12:30 am

State-by-state analysis of IRAs as exempt property
https://www.thetaxadviser.com/content/d ... achart.pdf

Note: I think a person needs to be concerned not only with the state where they live but where they might travel to.

learning_head
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Re: Who has needed to use their umbrella insurance?

Post by learning_head » Wed Oct 04, 2017 9:38 am

JDCarpenter wrote:
Fri Jun 17, 2016 2:43 pm
... the insured, if not retired, would be at risk for 2 million as well--wages can be garnished for a very long time.
michaeljc70 wrote:
Wed Sep 20, 2017 12:11 pm
You don't need assets. What if you have a job? They can possibly garnish those wages.
nimo956 wrote:
Sat Sep 16, 2017 8:57 am
... The only way I can see for the other party to collect is through wage garnishment ...
A reason to early-retire asap? :-)

Kinda serious question here - if I early retire, there is less chance of wages being garnished...?

And if my wages are garnished while I am working, I might be forced to stay at the job forever? How does that work? What if I get fired or leave the job on my own?

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dm200
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Re: Who has needed to use their umbrella insurance?

Post by dm200 » Wed Oct 04, 2017 11:18 am

OnTrack wrote:
Wed Oct 04, 2017 12:30 am
State-by-state analysis of IRAs as exempt property
https://www.thetaxadviser.com/content/d ... achart.pdf
Note: I think a person needs to be concerned not only with the state where they live but where they might travel to.
Note that there may be a big difference between being protected under bankruptcy vs other judgment.

michaeljc70
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Re: Who has needed to use their umbrella insurance?

Post by michaeljc70 » Wed Oct 04, 2017 11:31 am

learning_head wrote:
Wed Oct 04, 2017 9:38 am
JDCarpenter wrote:
Fri Jun 17, 2016 2:43 pm
... the insured, if not retired, would be at risk for 2 million as well--wages can be garnished for a very long time.
michaeljc70 wrote:
Wed Sep 20, 2017 12:11 pm
You don't need assets. What if you have a job? They can possibly garnish those wages.
nimo956 wrote:
Sat Sep 16, 2017 8:57 am
... The only way I can see for the other party to collect is through wage garnishment ...
A reason to early-retire asap? :-)

Kinda serious question here - if I early retire, there is less chance of wages being garnished...?

And if my wages are garnished while I am working, I might be forced to stay at the job forever? How does that work? What if I get fired or leave the job on my own?
Isn't it easier to just buy the umbrella insurance and try not to get sued (I know this is not always controllable)?

learning_head
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Re: Who has needed to use their umbrella insurance?

Post by learning_head » Wed Oct 04, 2017 4:43 pm

michaeljc70 wrote:
Wed Oct 04, 2017 11:31 am
Isn't it easier to just buy the umbrella insurance and try not to get sued (I know this is not always controllable)?
Buying umbrella insurance helps but does not fully protect you. You can buy insurance for $X and be sued for $X*10.

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Earl Lemongrab
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Re: Who has needed to use their umbrella insurance?

Post by Earl Lemongrab » Wed Oct 04, 2017 4:55 pm

learning_head wrote:
Wed Oct 04, 2017 4:43 pm
michaeljc70 wrote:
Wed Oct 04, 2017 11:31 am
Isn't it easier to just buy the umbrella insurance and try not to get sued (I know this is not always controllable)?
Buying umbrella insurance helps but does not fully protect you. You can buy insurance for $X and be sued for $X*10.
Yes, but the number of times a judgment against an individual has exceeded the umbrella amount (especially higher ones) is very small. The amount you are sued for is irrelevant. Probably even less when appeals are considered. Trying to hide your money isn't terribly useful. If worried, increase your coverage.
This week's fortune cookie: "You will do well to expand your horizons." Ow. Passive-aggressive and vaguely ominous.

nelson1015
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Re: Who has needed to use their umbrella insurance?

Post by nelson1015 » Wed Oct 04, 2017 5:02 pm

I'm an underwriter...and agree it's not a scam and is paid out for horrific situations.

What happens if you carry 25k in minimum auto liability limits, then you hit someone and cause permanent disability. How far does that 25k go? Now imagine you are carrying 25k in liability limits but you own your house outright and have a 500k portfolio. Do you think a lawyer isn't going to come for your assets?

Umbrella insurance is all about asset protection. We live in a very litigious society.

Have a dog? It bites a child and deforms them? Trampoline? Swimming pool? Do you know you can get sued if someone hops your fence and drowns in your swimming pool? Even if they are trespassing?

The $200 a year for an umbrella policy is worth the peace of mind if you have assets.

Palatineman
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Re: Who has needed to use their umbrella insurance?

Post by Palatineman » Wed Oct 04, 2017 7:29 pm

https://www.moneycrashers.com/umbrella- ... ce-policy/

This article explains a lot. I am glad I have an umbrella policy of $2 mil at $375 a year.

Owning 2 properties (1 rental) and a car, I can get sued for a variety of unforeseen situations.

If I get sued, even once, without any intentional part of my own doing, the legal support would pay hundreds of times over the yearly premium.

For my situation, paying for Umbrella Insurance is a no-brainer.

Mordoch
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Re: Who has needed to use their umbrella insurance?

Post by Mordoch » Wed Oct 04, 2017 8:33 pm

learning_head wrote:
Wed Oct 04, 2017 9:38 am
Kinda serious question here - if I early retire, there is less chance of wages being garnished...?

And if my wages are garnished while I am working, I might be forced to stay at the job forever? How does that work? What if I get fired or leave the job on my own?
This is probably an overrated concern in most situations.

Unless you are talking about a drunk driving situation on your part or another member of your household, or some other situation involving exceptional wrongdoing (being merely a lousy drive does not count), you can discharge any wage garnishment orders through bankruptcy.

Furthermore, in most states IRA assets are vulnerable to being seized due to lawsuit judgement, so you need to declare bankruptcy to potentially protect them. (Beyond a certain level, somewhere over 1.2 million, IRAs could still be at risk even in bankruptcy for the record.) Without bankruptcy you also can find other assets being vulnerable to seize which in addition to taxable accounts including in most states your house if you own it, your car, and other personal assets. (Some of these last three asset types are often vulnerable in bankruptcy to various degrees as well for the record.)

The big picture is you are generally going to end up declaring bankruptcy in various situations if the judgement that ultimately goes against you is enough above your insurance liability and otherwise effectively exposed assets, so garnishing assets rarely really becomes especially relevant in the sort of situation you are thinking about. (It could if someone was not so prepared for retirement and was counting on Social Security plus what was in their 401k.)

With the exception of child support (I am not sure about all the possible details with alimony), possibly owing the IRS in some situations, and a few other situations involving restitution for crimes you were convicted of, I am not aware of situations where it is possible for someone to basically effectively force you to continue to work to pay off wage garnishments. They can always try to attack other exposed assets instead, but if there are not any they are out of luck if you have permanently stopped earning income in a way they can garnish or otherwise go after your assets.

Having said this, the big picture is if you have sufficient exposed assets you should really consider protecting them through umbrella insurance.
Last edited by Mordoch on Wed Oct 04, 2017 8:41 pm, edited 2 times in total.

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Geneyus
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Re: Who has needed to use their umbrella insurance?

Post by Geneyus » Wed Oct 04, 2017 8:38 pm

I just saw a wreck today where a teenager ran a red light and killed two people in another car. Several witnesses described the teen's reckless driving. Do you think they'll use their umbrella policy once this goes to civil court? Probably so. Auto insurance has limits.

The parents weren't anywhere around, but you can bet they'll be sued.

learning_head
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Re: Who has needed to use their umbrella insurance?

Post by learning_head » Thu Oct 05, 2017 8:42 am

Earl Lemongrab wrote:
Wed Oct 04, 2017 4:55 pm
learning_head wrote:
Wed Oct 04, 2017 4:43 pm
michaeljc70 wrote:
Wed Oct 04, 2017 11:31 am
Isn't it easier to just buy the umbrella insurance and try not to get sued (I know this is not always controllable)?
Buying umbrella insurance helps but does not fully protect you. You can buy insurance for $X and be sued for $X*10.
Yes, but the number of times a judgment against an individual has exceeded the umbrella amount (especially higher ones) is very small. The amount you are sued for is irrelevant. Probably even less when appeals are considered. Trying to hide your money isn't terribly useful. If worried, increase your coverage.
Sorry, the point was not about getting or not getting coverage. It was about how garnishing wages works in real world and what it means in the post just above that one. I know chances of coming to it are small, but apparently, they are not 0.

dowse
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Re: Who has needed to use their umbrella insurance?

Post by dowse » Thu Oct 05, 2017 9:46 am

downshiftme wrote:
Tue Oct 03, 2017 3:23 pm
I have used mine, but only indirectly.

A scammer hit my parked car in a public place, then claimed I hit him and caused a neck (like whiplash) injury. The amount claimed was within my Auto insurance limits, but because I also had umbrella, the insurance company sent a top team of lawyers to defend the claim and it was quickly tossed out of court.

This one incident alone makes me more than happy with my umbrella coverage and I plan to keep it forever, with occasional increases in limits due to inflation.
This reminds me of a common scam in a certain part of Florida. There scammers on bicycles, many homeless, who jump out in front of cars coming to a stop at an stop light on a busy highway. They try to have a collision such that they are not really hurt, but can fake a serious injury. My MIL had such an incident. The "injured party" sued for $30,000. Her insurance company settled the case for $3000. Not an umbrella liability case, but the method could be scaled up.
Her next door neighbor had a similar incident, but when she threatened to call the police, the "injured party" had a miraculous recovery.

sarahjane
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Re: Who has needed to use their umbrella insurance?

Post by sarahjane » Mon Oct 09, 2017 9:21 pm

sarahjane wrote:
Thu Jun 16, 2016 4:56 pm
OK, I'm the one you're looking for.

My spouse was in a head on vehicle accident where she was determined to be at fault. The passenger in the other vehicle died and the driver had serious injuries. The case settled for the liability limits of the auto policy plus the umbrella. Without the umbrella there's no question personal assets would have been at risk. Incidentally, the umbrella was renewed. Please don't ask for more details. It's cheap coverage for peace of mind.

Mr.Wu
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Re: Who has needed to use their umbrella insurance?

Post by Mr.Wu » Mon Oct 09, 2017 9:35 pm

dowse wrote:
Thu Oct 05, 2017 9:46 am
downshiftme wrote:
Tue Oct 03, 2017 3:23 pm
I have used mine, but only indirectly.

A scammer hit my parked car in a public place, then claimed I hit him and caused a neck (like whiplash) injury. The amount claimed was within my Auto insurance limits, but because I also had umbrella, the insurance company sent a top team of lawyers to defend the claim and it was quickly tossed out of court.

This one incident alone makes me more than happy with my umbrella coverage and I plan to keep it forever, with occasional increases in limits due to inflation.
This reminds me of a common scam in a certain part of Florida. There scammers on bicycles, many homeless, who jump out in front of cars coming to a stop at an stop light on a busy highway. They try to have a collision such that they are not really hurt, but can fake a serious injury. My MIL had such an incident. The "injured party" sued for $30,000. Her insurance company settled the case for $3000. Not an umbrella liability case, but the method could be scaled up.
Her next door neighbor had a similar incident, but when she threatened to call the police, the "injured party" had a miraculous recovery.
Dash cam is a godsend.

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