Teenagers do dumb things. My husband and I have three of them at home (17, 15, 13) and one more coming up- that acts more and more like her teenage brothers and sisters every day, so we know this first-hand. And if you have any teenagers of your own (or have gone through the process)- you know exactly what I am talking about too.
We can love them, we can raise them right, but at the end of the day- teens are still navigating through the chasm between adulthood and childhood. They just don’t always make the decisions we would like them to.
Did you know that the fatal crash rate per mile driven is nearly twice as high for 16-17 year olds as it is for 18-19 year olds, according to the Insurance Institute for Highway Safety? Putting your teenage driver in the driver’s seat of a car is one of the scariest things a parent can do. It’s also a very dangerous thing- as parents, we are liable for anything our child does behind the wheel.
Our children can literally bankrupt us because of the decisions they make.
The good news is that having an Umbrella Policy or an “excess liability policy” can help protect you from financial losses that could occur from having a teen… or any child living under your roof.
Umbrella policies sit on top of your existing auto and home/renters policies to provide additional liability coverage. You may have liability coverage for $250,000 per person on your auto insurance- but if your 17 year old t-bones another car and kills the driver, you are going to have a wrongful death lawsuit on your hands. In the state of Wisconsin, wrongful death lawsuits pay out $500,000 for the death of a child and $300,000 for the death of an adult.
In the example above, if your teenager was liable for an accident that resulted in the death of a child and there was a wrongful death payout of $500,000; your auto insurance would only pay the first $250,000. The other $250,000 would come out of your own personal assets (savings, wages, etc). Most people don’t have that additional $250,000 in a savings account so they can’t just write a check. A liability judgement of that nature is financially devastating.
It’s easy to see why adding a teenage driver to your family can increase your risk for a liability judgement. But what about other reasons why a teenager may increase your risk for liability?
What if your son blinds one of his friends playing with an airsoft gun?
What if your teenager is skiing and gets into a collision with another skier and the family sues for recklessness?
What if your teenager sneaks a friend into your house to drink liquor and then they go out driving and paralyze another driver in a crash? If an underage minor gets alcohol from your house (even unbeknownst to you), you can be liable for his or her actions if they injure someone else. Even if it isn’t your own child.
What if you are chaperoning the out-of-state foreign language field trip for your child’s class and there is a tragic accident – and another student dies? You could be named in a negligence lawsuit.
Your teenage daughter writes a scathing (and exaggerated) review of a company and they file suit for defamation.
These are all examples of real-life situations where Umbrella Policies have paid out so that parents didn’t have to!
You don’t have to be a millionaire to get sued like one- so having 1 or 2-million dollars in excess liability coverage can protect your family in all sorts of situations. The best part is, Umbrella Policies aren’t very expensive. For anywhere between $15-$30/month, you can have peace of mind that your teenager won’t put you in the poor-house.
For more information on Umbrella policies- or to get an insurance review, please don’t hesitate to contact Richards Group.
Click here to read From Zero to a Million in the Flash of an Eye: Why Umbrella Policies are Important, which is another blog we wrote regarding Umbrella Policies back in October, 2017.