DEAR HARRY: We carry $300,000 of liability insurance on our car plus an equal amount on our homeowner's policy. Our insurance agent has suggested that we should have additional liability insurance (an umbrella policy) to cover us beyond those limits. He gave us a company brochure that scared the wits out of my husband. It was loaded with all kinds of situations that umbrella policies would have solved. We have total assets of a little more than a million, so he suggested a $1 million umbrella. The premium would be only $170 a year. He also suggested that we go to the same insurance company that handles our auto and home insurance. What's your take on this?

WHAT HARRY SAYS: Some years ago, a close friend was sued for $750,000 as a result of an injury to a passenger in his car. The plaintiff had no knowledge of his umbrella policy, so it appeared that my friend was possibly going to get hit with $450,000 out of pocket. The insurance company had its legal team defend him. It was a team from one company so they had full responsibility. He won, but he could have been severely hurt if the suit was lost. Without the policy, his legal fees alone would have hit hard, win or lose. I think you're getting good advice from your insurance agent. Get the umbrella policy and sleep soundly.

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