As the words itself proposes, an umbrella insurance policy is a form of liability insurance that will supplement your basic liability policies, such as your auto, home or renters insurance. An umbrella liability policy covers a much higher limit and goes above and beyond claims directly relating to your home and auto.
The main purpose of your umbrella policy is to protect your assets from an unforeseen event, such as a tragic accident in which you are held responsible for damages or bodily injuries. If another
party files a lawsuit against you, your umbrella coverage will pay for the damages you're legally responsible for up to the policy limit.
To make easier to understand, picture an umbrella: Right below a heavy storm, there is your home, auto, landlord, renters policy. Under all of those policies, there is the insured. Umbrella has a broad coverage with much higher limits. It starts paying after the other policies have paid their limits, but usually these limits have high limit requirements as well.