What is Personal Liability Insurance?

Liability insurance, on a broad level,  provides financial protection to a policyholder at risk for being sued for potentially harming someone. If a court of law determines that a person, business or organization is to blame for damages caused to another person, business or organization, liability insurance steps in to help with the financial burden of making things right.

There are five different types of liability insurance. Each type covers a different individual/group:

  • drivers
  • individuals
  • organizations
  • businesses
  • manufacturers

Liability insurance  that covers drivers and individuals is called Personal Liability insurance. Situations where you might need personal liability coverage:

  • You cause a car accident where someone sustains injuries
  • The mailman falls on your broken porch step and sues you

Personal liability coverage is offered in most standard homeowners and auto insurance policies. However, auto and home liability coverages are very different.

Individual/Homeowners Liability Coverage

Most standard homeowners insurance (and renter’s insurance) policies provide coverage for liability. Liability coverage protects homeowners in the event they are faced with a lawsuit and found to be responsible for damages they caused, or damages sustained on their property. For example, if your dog bites someone and they sue you- the liability  portion of your homeowners policy will typically provide financial assistance to help pay the damages.

Drivers/Auto Insurance Liability Coverage

A standard auto insurance policy also offers liability coverage for drivers in the event they cause damages to another person, or another person’s property,  with their automobile.  Auto liability coverage differs from homeowners liability coverage as a lawsuit does not need to be presented in order for an auto insurance company to pay out on an auto insurance liability claim. The first type of liability coverage a driver has is bodily injury liability which protects the driver in the event that injuries are sustained in an at-fault accident. The second type of auto liability is property damage coverage which protects the driver in the event they cause property damage to another person’s property, usually another vehicle. Bodily injury and property damage have state-set minimums and are capped at a maximum payout per accident and per injured person.

For specific coverages on your auto and home insurance be sure to contact your insurance agent

Standard Home Insurance Coverage

Your home insurance protection presents a total package, not just dwelling coverage. Home insurance is more than a sum of its parts, but understanding those parts can help you get the best whole product. These coverage types typically are included in a standard policy