Umbrella policies provide additional limits over the underlying liability. It usually delivers broader coverage than excess liability policy. Excess liability policies also give further limits over the underlying liability, although it is more restrictive and does not provide coverage that is unavailable in the underlying policy.
When a policyholder is being sued in civil court, whether for poor driving or other reasons, he or she needs liability coverage. Liability protection comes from car insurance policy. The rest of the protection comes from special policies, such as umbrella and surplus insurance.
Umbrella insurance is a policy that shields the properties and imminent income of a person who retains the policy when he is being sued in civil court. The two policies are similar, but the excess liability only comes into play when all other policies have been examined to cover a claim a person has been asked to pay and provides extra coverage.