Umbrella Policy Calculator
Work out the gap above your existing liability limits, and why umbrella cover gets cheaper per million as you buy more.
"Future earnings exposed" is a judgement call — a judgment can be collected from wages for years, but not all of them and not without limit, and the rules vary by state. Treat it as a rough share of the working years ahead rather than a precise figure. Nothing is uploaded.
The only cover that gets cheaper as you buy more
A first million costs about $200 a year and each additional million about $100. So the price per million falls from $200 to $110 across this range. Almost every other kind of cover works the other way round.
| Cover | Premium | Per million |
|---|---|---|
| 1 million | $200 | $200 |
| 2 million | $300 | $150 |
| 3 million | $400 | $133 |
| 5 million | $600 | $120 |
| 10 million | $1,100 | $110 |
Umbrella escapes the usual pattern because it sits above the auto and home policies, which absorb every frequent, small claim before it is touched at all. What reaches it is rare, so the second million is barely more likely to be claimed than the tenth. The odd consequence is that buying the amount you actually need is proportionally cheaper than buying a token amount — the total still rises, but the rate does not.
The exposure is not only what you own
A judgment can reach future earnings as well as present assets, so the figure to protect is the balance sheet plus whatever share of the working years ahead could be attached. For the early-career household below that is most of the exposure, and their net worth alone would badly understate it.
| Exposure | Already carried | Gap | Cover | |
|---|---|---|---|---|
| Renting, early career | $240,000 | $300,000 | none | — |
| Owns a home, mid career | $1,050,000 | $300,000 | $750,000 | 1M at $200 |
| Established, higher limits | $2,300,000 | $500,000 | $1,800,000 | 2M at $300 |
Note the first row: no gap at all. $240,000 of exposure sits entirely inside the $300,000 already carried, so no umbrella is required and the honest answer is to buy none. The gap opens when exposure passes what is carried underneath, and not before — which also means raising the underlying limits is the cheaper move for anyone close to the line, since it is the first million of umbrella that costs the most.
How to use
- Enter your net worth and the future earnings a judgment could reach.
- Enter the liability limit you already carry.
- Read the gap above it.
- Compare the cost per million at each level of cover.
Frequently asked questions
How much umbrella cover do I need?
Enough to cover the gap between your exposure and the liability limits you already carry. Exposure is not just net worth — a judgment can reach future earnings through wage garnishment for years, so the figure to protect is the balance sheet plus whatever share of your working years ahead could be attached.
Do I need umbrella cover at all?
Often not. Someone renting early in their career with $40,000 saved and $200,000 of exposed earnings has $240,000 of exposure, which ordinary 300/300 limits already cover entirely. The gap opens when exposure passes what you carry underneath, and until it does the honest answer is to buy none.
Why is umbrella cover so cheap?
Because it sits above your auto and home policies, which absorb every frequent, small claim before the umbrella is touched. What reaches it is rare — so a first million costs around $200 a year and each additional million around $100.
Does more cover cost proportionally more?
No, and this is unusual. The price per million falls from about $200 to about $110 as you go from one million to ten, because the second million is barely more likely to be claimed than the tenth. The total still rises; it is the rate that comes down.
Should I raise my underlying limits instead?
Often yes, if you are close to the line. The first million of umbrella is the dearest one, so lifting auto and home liability from 300 to 500 can close a modest gap for less. Insurers generally require high underlying limits before selling an umbrella anyway.
What counts as exposed future earnings?
A judgement call rather than a formula. A judgment can be collected from wages for years, but not all of them and not without limit, and the rules vary by state. Treat it as a rough share of the working years ahead rather than a precise figure.
Is this only for wealthy people?
It is for anyone whose exposure exceeds their limits, which includes households with modest savings but substantial earning years ahead. It is also genuinely unnecessary for plenty of people, which is why the calculator will tell you when the gap is zero.
Does this send anything anywhere?
No. Every figure is computed in your browser, and nothing is uploaded or stored.
🔒 This tool runs entirely in your browser. Nothing you enter is uploaded, logged, or stored.