A personal umbrella policy is liability insurance in excess of other policies, typically auto and homeowner insurance. It is a relatively inexpensive form of coverage when you have assets valued over the policy limits of the underlying policies. If there is a serious accident (car or property), you are liable for damages above the policy limits. If damages are awarded in a lawsuit, your assets may be seized and you may be required to make payments from your pay check to pay for these damages. A personal umbrella policy will not only help to cover those damages but it could also provide for your legal defense. Umbrellas only make sense when you have assets. For the price, it is one of the cheapest ways to protect yourself. I recommend umbrella policies to all of my clients in this situation. There is also a business umbrella policy as inexpensive excess coverage from a commercial general liability policy.