Mercury Insurance has introduced an enhanced personal umbrella insurance policy in Florida, designed to provide homeowners and drivers with an added layer of liability protection. This follows earlier launches in California, Texas, Oklahoma, Illinois, Arizona and Georgia.
The move comes as bodily injury payouts continue to rise each year, with the average liability claim up 35% since the pandemic began. Incidents such as multi-vehicle crashes, dog bites or injuries sustained by delivery persons on private property have contributed to this upward trend. Mercury cited these developments as the impetus for expanding coverage, which starts at just over $1 a day.
The insurer highlighted the value of an umbrella policy as a financial safety net, protecting policyholders whose primary auto or home insurance limits may be exhausted. Such coverage is especially relevant in Florida, where personal injury claims can be large and unexpected.
In Florida, umbrella insurance acts as a financial safety net that steps in when liability limits of standard policies are exceeded. It covers situations like injuries on your property, serious vehicle accidents, defamation or libel where homeowners and auto policies may fall short. Coverage typically starts at $1 million and can be tailored upwards, offering broader protection than excess-only policies.
Umbrella policies in the US, including Florida, often include "drop-down" features that cover risks not found in standard insurance and can act as primary insurance for certain gaps. To qualify in Florida, policyholders must meet minimum underlying coverage requirements. For auto insurance, this might mean at least $250,000 bodily injury coverage per person and $100,000 property damage.
Despite Florida’s overall high insurance costs, umbrella policies remain relatively affordable. A $1 million policy in Florida average around $400 per year, though premiums vary depending on factors like driving history, net worth and claims history.
Mercury’s update introduces discounts such as a 5% reduction for drivers with no accidents in the past three years. Coverage options also include incremental increases up to $2 million and uninsured motorist protection up to $1 million.
Industry-wide trends are pushing umbrella insurance prices upward. Across the US, average annual premiums grew by 7% from 2019 to 2022, with some clients reporting premiums nearly tripling for the same coverage, particularly after personal or regional risk increases. Approval for higher limits has become more selective.
Nick Colby, VP and chief sales officer at Mercury, shared a case where a long-time policyholder, a doctor, settled a moped accident that exceeded his $25,000 auto policy limit. Without umbrella coverage, he faced years of out-of-pocket payments from his salary. This underscores the policy’s role in shielding personal finances from significant legal judgments.
