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LLC vs Umbrella

LLC vs umbrella insurance

Compare what each actually protects and what it really costs per year. The honest answer is usually layered — primary insurance, then umbrella, then maybe an LLC — not either/or.

Your setup

Annual cost, side by side. Everything updates live.

$M
Annual cost, side by side
LLC(s) vs umbrella · illustrative
Your Landlord Guide
Est. 2026
LLCs · per year
$2,400
$800 CA minimum franchise tax × properties
Umbrella · per year
$150 – $300
~$150–$300 per $1M of coverage
The honest read
  • An LLC does little if the mortgage and title stay in your personal name.
  • A single-member LLC you self-manage is a weak shield — courts can look through it.
  • Umbrella insurance is often the cheaper first layer of protection.
  • The honest answer is usually layered — primary insurance, then umbrella, then an LLC — not either / or.

Informational purposes only — estimates for discussion, not tax, legal, or financial advice. No professional-client relationship is created. Consult a qualified CPA about your situation.

Design your protection layers with a specialist

The right mix depends on your loans, equity, and state — a specialist maps it with you, no obligation.

How this is calculated · sources

Every figure traces to a source

What this estimate assumes

  • We only model LLC costs for California, the one state we hold a firm figure for. Elsewhere we show no figure rather than inventing one — fees vary from nominal to four figures depending on franchise taxes and publication requirements.
  • The California figure is the MINIMUM annual franchise tax. An LLC with California income above the threshold owes an additional fee on top, and formation, registered agent and annual report costs are excluded everywhere.
  • LLC cost assumes one LLC per property. Many landlords use a single LLC or a series structure, which changes the comparison substantially.
  • Umbrella cost is priced per $1M from a sourced band. Real pricing is front-loaded — the first million carries the underwriting cost — so anything above $1M here is an over-estimate.
  • An LLC does little if the mortgage and title stay in your personal name.
  • The honest answer is usually layered: primary insurance → umbrella → maybe an LLC.