This summer my wife’s new car was rear-ended. She has had to do PT, but thankfully did not end up in the hospital, or worse. The car repairs were not too extensive, and no one else was seriously hurt.

But judging from our mailbox for two weeks after her accident, you would have thought the worst. I’m referring to the 20+ solicitations we received from law firms. We received personal letters, some handwritten. We received colorful brochures. We received DVDs. We were on the radar screen of the 20 best personal injury attorneys in North Carolina (they were all tied for #1, based on their claims). The only thing we didn’t receive was an offer for insurance covering repairs to our mail box, which was buckling under the weight of all the mail.

My point: if you think you don’t face any risk of a lawsuit, think again.

The way to protect yourself is personal liability insurance, also known as “umbrella insurance”. It provides coverage for personal (not business) liability above the amount in a standard home or auto policy. Those limits are usually $250,000 to $500,000. If you have meaningful net worth outside your retirement plan and are found liable in a serious car accident, you can be sure the plaintiff will seek a lot more than $500,000.

The cost of “umbrella insurance” is very low, because – thankfully – you’re unlikely to need it. But you will be very relieved if you do.