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 [email protected].