Checklist: Insurance Review

Things to do this weekend with your money:

Your homeowners and auto insurance might not give you enough protection against lawsuits, particularly if you have substantial assets or income or are in a profession that’s prone to litigation. A personal liability policy, also known as an umbrella liability policy, can protect you against lawsuit awards of $1 million or more and fill the gaps in your current coverage.

Today: Find out how much personal liability coverage you currently have. Homeowners policies may cover you for $300,000, although some offer higher limits. Auto insurance limits may be as low as $30,000, although some insurers now offer personal liability limits of $500,000 or more.

Saturday: Estimate how much liability insurance you may need. Rules of thumb vary widely, with most financial planners suggesting at least one to two times your net worth. Some suggest adding 10 times your current income to that total.

Sunday: Plan to shop for quotes. Check first with your auto and homeowners insurance companies, because they may offer you a break. Most insurers require that you have either auto or homeowners policies with them before they will extend umbrella coverage. Insurers are also likely to require that you boost your current liability protection to the maximum available before writing an umbrella policy. Be sure to include those costs when you’re shopping for quotes.