Umbrella insurance terms, explained
What these terms mean when they appear on umbrella insurance. Each definition describes the term itself, not what to do about it.
- Attachment point
- The dollar level where your umbrella policy starts paying, which sits at the top of your underlying home or auto liability limit.
- Claim
- A request you make to your insurance company to pay for a covered loss.
- Coverage
- A part of your policy that pays for a specific kind of loss, up to a limit.
- Deductible
- The amount you pay out of your own pocket on a claim before your insurance starts paying.
- Endorsement
- An add-on or change to your policy that adds, removes, or adjusts coverage. Also called a rider.
- Exclusion
- Something your policy specifically does not cover.
- In force
- Active and providing coverage, because the policy is current and paid.
- Insured
- A person or thing your policy protects.
- Liability
- Coverage that pays for injury or damage you are responsible for causing to someone else.
- Limit
- The most your policy will pay for a covered loss.
- Out-of-pocket
- Money you pay yourself, that your insurance does not cover.
- Policyholder
- The person who owns the insurance policy.
- The amount you pay for your insurance, usually each month or once a year.
- Sub-limit
- A smaller, separate cap inside a coverage that applies to certain items or losses.
- Sublimit
- A smaller, separate cap inside a coverage that applies to certain items or losses.
- Underlying limit
- The liability limit your home or auto policy must carry before the umbrella applies. Falling below it can leave a gap.
- Underwriting
- How an insurer decides whether to cover you and at what price, based on the risk.
Other policy types
These are general definitions. Your own policy is what governs your coverage, and the same term can be defined differently from one policy to the next. Read your own policy to see what these terms say in your document, cited to the page.