Insurance
Plan. Invest. Thrive.
The layer above everything else.
An umbrella policy is what sits on top of your auto and home liability — and catches everything that exceeds them. If you've built any real net worth, this is the cheapest dollar of protection on your balance sheet.
Your home and auto policies usually cap liability at $300,000–$500,000. A jury verdict doesn't care about that cap. Whatever the judgment is above your underlying limit comes from your assets — investments, home equity, future income — unless an umbrella sits in between.
- Teen driver? The statistics are not in your favor.
- Swimming pool, trampoline, dog, or guests in the home? Premises liability lives here.
- Boat, jet ski, or rental property? Each adds an attack surface.
- Public profile — board seat, business owner, social media? Settlement targets get sized to the defendant.
- Net worth above $1M? You're now worth suing for real money.
2
How to size it — our rule of thumb
Round up your investable net worth (everything outside your primary residence and qualified retirement accounts in Ohio) and the next ten years of after-tax income. Buy at least that much. Then round up to the nearest million.
Investable assets (taxable + the at-risk portion of retirement)$1,200,000
Home equity above the homestead exemption$300,000
10 years of after-tax earnings (income stream a plaintiff can target)$1,500,000
Suggested umbrella coverage$3,000,000
Sample household. Yours is different — we'll walk through your actual numbers together. Ohio's homestead and ERISA protections shield more than people realize, but a court order can still attach future income.
3
What it covers — and what it doesn't
| An umbrella generally covers | It does not cover |
|---|
| Bodily injury & property damage you cause to others — above your auto/home limits |
Damage to your own property or vehicles |
| Libel, slander, defamation — including online |
Intentional or criminal acts |
| False arrest, invasion of privacy claims |
Business activities (need a commercial policy) |
| Legal defense costs — usually outside the liability limit |
Professional liability (E&O, malpractice) |
| Liability from rental properties & recreational vehicles |
Workers' comp for household employees (separate rider) |
4
What it costs (Ohio, typical)
| Coverage limit | Single household, clean record | Two cars + teen driver |
|---|
| $1,000,000 | $200–$350 /yr | $400–$650 /yr |
| $2,000,000 | $300–$500 /yr | $550–$900 /yr |
| $5,000,000 | $550–$900 /yr | $950–$1,500 /yr |
| $10,000,000 | $1,000–$1,800 /yr | $1,700–$2,800 /yr |
The first million is the most expensive. After that, each additional million is dramatically cheaper — which is why most clients carrying any umbrella should consider going larger.
5
The fine print that actually matters
- Your auto & home limits must hit a minimum for the umbrella to attach — usually $250K/$500K bodily injury auto and $300K homeowner liability. Carriers will tell you what they require.
- The umbrella drops if the underlying lapses. If you let auto coverage lapse and have an accident, the umbrella may not respond.
- One carrier is usually simpler. Buying umbrella from the same insurer as auto/home avoids gap fights and qualifies for multi-policy discount.
- List every driver and every vehicle. Unlisted drivers are a coverage exclusion waiting to happen.
- Review at every life event. New driver, new home, new business, new rental, kids off to college — call us.
The most expensive mistake: a $1M umbrella on a $4M net worth. The umbrella exhausts; the plaintiff continues. Size it for the verdict, not the premium.
A note from MPM
Umbrella is one of the few places in financial planning where the math is honestly easy: cheap premium, catastrophic protection, decades of peace of mind. We'd rather have a thirty-minute conversation about your coverage limits now than a thirty-month conversation about a judgment later.
MPM Wealth Advisors · Plan. Invest. Thrive.
mpmwealth.com · Updated May 2026
Sources: Insurance Information Institute (III) annual umbrella liability pricing benchmarks; National Association of Insurance Commissioners (NAIC) claim data; Ohio Department of Insurance for state homestead and ERISA protections. Pricing ranges are illustrative; actual quotes depend on carrier, household composition, and prior claims history.