Homeowners insurance provides homeowners with coverage for the loss of the home and personal belongings, as well as liability protection. Today, we will discuss liability protection.
In a nutshell, the liability portion of a homeowners insurance policy covers you against the costs associated with injuries or damage caused by your property or family. Typically, limits to liability protection begin at $100,000. This protection extends anywhere in the world. Liability protection does not cover the cost of damage done to your property or injuries suffered by people living in your home. Nor does it apply to accidents or injuries caused by automobiles.
Liability coverage provides no-fault medical coverage if an injury occurs on your property. The injured person can collect on the medical bills resulting from the accident if he or she submits them to your insurance company. This coverage applies only to people that do not live in your home. For example, liability protection will not pay the medical bills if your spouse breaks an arm as a result of slipping on ice on your porch. It will, however, pay the medical bills if a delivery person breaks his or her arm in a similar accident on your property.
Secondly, liability protection covers the cost of damage done by family members living in your home to another person’s property. For example, the insurance company will pay for the repair, if your son kicks a soccer ball into your neighbor’s window. However, the liability portion of the policy will not pay for the same damage if your son were to break your window.
The third part of liability protection covers the insured against lawsuits for injuries or property damage caused by you, your family, and your pets. If you are sued, liability coverage pays for both the cost of a court defense and awards given up to the limit of the liability portion of the policy.
Lastly, if you have a substantial net worth, your assets could be at risk if you are sued and the court award exceeds policy limits. If this describes your situation, you should consider purchasing an umbrella policy. For more information, please see the article Umbrella Liability Coverage written by Suzanne Lako.
Henssler Financial recommends that you take the time to look over your homeowners insurance policy, understand the limits of your liability coverage and purchase an umbrella policy if deemed necessary. For more information regarding this topic, please contact Henssler Financial at 770-429-9166 or experts@henssler.com.
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With the 2005 Terri Schiavo case, many individuals, regardless of age, became aware of the importance of communicating their healthcare wishes. Her case, which ensued after Schiavo suffered heart failure and subsequent brain damage at the age of 26, involved a seven-year battle between her husband and her parents over a healthcare decision. She had no written instruction—whether she would have wanted to live by being sustained through feeding tubes and life support. As Schiavo did not have a living Will, the courts were required to decide her fate, leaving speculation as to what she would have truly wanted.
Living Will
A living Will is also known as a “health care declaration.” This is a document in which you can express specific wishes with regard to what medical care you wish to receive in the event you are incapacitated or too ill to make decisions on your own.
This document allows you to make your wishes known in advance, regarding specific treatment methods, such as resuscitation, surgery, use of respirators, administration of drugs, food, water and pain relief. This document does not allow you to select someone to act on your behalf.
Healthcare Power of Attorney
To ensure that your wishes are met if you are unable to communicate, you can name a healthcare agent in addition to or as part of your living Will. A Healthcare Power of Attorney enables you to provide authority to a healthcare agent to make decisions regarding your healthcare needs in the event that you cannot. While we strongly suggest that you name a healthcare agent, it is not a requirement.
In some states, this person is called a “healthcare proxy” or “attorney in fact,” even though the person does not need to be an attorney. You are able to give as little or as much control to this person as you wish. For example, you can give this person the authority to make decisions based solely on the wishes stated in your living Will and/or make decisions as he or she deems necessary should unforeseen instances arise. While this responsibility usually ends at the time of your death, it is also possible to give your agent the authority to oversee issues relating to organ donations and body disposition after death.
In some states, the living Will and healthcare power of attorney can be combined into a single document—often called an “advance directive.” In most cases, these documents become effective as soon as your doctor, or other healthcare official, determines that you do not have the ability to understand the healthcare options available to you, and/or you are unable to physically communicate your wishes regarding your care. If there is ever doubt about the level of “incapacity,” then your doctor, in conjunction with your agent or close relatives, will decide the best time for the documents to become effective.
Choosing a Healthcare Agent
You should take into consideration the following factors when choosing an agent:
- Do you trust the person without a doubt?
- Is the person someone you know will assert your wishes, if conflict arises involving family members or your doctor?
- Where does the person reside? This is especially important in a case when you have a long illness, and the agent needs to stay close to you for a period of time to oversee your care.
- Will the person also oversee your finances in the event of your incapacity? If you have separate agents, disagreements could cause interference with medical decisions, especially when payment is needed to cover medical expenses.
It is also important, but not required, to select an alternate agent in the event that your first choice is not able to assume the responsibility. It is possible to have more than one agent.
You must be at least 18 years old to create a living Will or healthcare power of attorney. You must be of sound mind and be able to understand what the documents are and how they work. As with most legal documents, you must sign these documents and have them witnessed and notarized.
It is important to state your specific healthcare wishes in a living Will. Your doctor or medical institution will be required to follow these wishes. At the very least, you should communicate your wishes to those close to you—your family members and close friends. For more information on your options, talk to your estate-planning lawyer or contact
