Reply to How to calculate net worth for umbrella insurance

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]I would think you exclude retirement savings and college savings because a creditor can't reach those things.  But I'm guessing.  I am a lawyer, though, so it's not an entirely uneducated guess![/quote]

This is OP and that’s my guess too but I can’t find any definitive confirmation of it. [/quote]

I don’t think it’s a hard fast rule. You need to have enough insurance that whoever is suing you is happy to take the max amount without going after you personally.

If you have a 2 million dollar policy and 2 million in liquid assets and two million in retirement assets a 4 million dollar verdict puts you on the hook for 2 million.

That being said verdicts like that are rare (and attorneys who will turn down a 2 million insurance payout to try to chase down money from an individual is also going to be rare). Of course the rareness is why it’s so cheap but I know you don’t want to hear about that. [/quote]

It’s not cheap as far as I’m concerned. $800 a year is still a lot of money to me as while it network is relatively high our income is not.[/quote]

If you don't understand that income that net worth is money you can spend, and that income contributes to net worth, you probably shouldn't be the person making financial decisions in your life.

You can cash out or borrow $50K from your net worth, to cover $800/year for the rest of your life. [/quote]

I guess you don’t understand that the reason my net worth is relatively high compared to my income is because I look after my money and don’t frivolously spend more than I need to. Sheesh! [/quote]

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