• You have your base liability coverage (say from your auto or homeowners policy).

• If you’re sued for an amount that exceeds the liability limits of those base policies, the umbrella policy kicks in to cover the excess (up to its own limit).

• Example: Say your auto liability limit is $300,000, a judgment is $800,000 — you’d be on the hook for $500,000 unless you had an umbrella policy that stepped in. (Numbers for illustration only.)

Typical things it covers:

• Bodily injury to others.

• Property damage you’re liable for.

• Legal defense / court costs (for covered liability claims) beyond your underlying policy.

• Some “personal injury” exposures the standard policy might exclude: e.g., slander, libel, invasion of privacy.

Typical exclusions / limitations:

• It generally does not cover damage to your own property.

• It typically does not cover intentional acts, criminal acts, or contractual liabilities assumed.

• If you have significant assets (home equity, retirement accounts, investments) that you want to protect from a large lawsuit.

• If you have greater liability risk: rental property, a swimming pool, boat or ATV, teenage drivers in the household, large gatherings, etc.

• Because lawsuits (and claim sizes) have increased, and standard liability limits may no longer be as safe a cushion as they once were.

Yes, you generally can purchase it whenever you qualify (meeting underlying policy minimums). But it won’t cover incidents that occurred before the policy began.