Homeowners Insurance – Liability Coverages Explained
Have you ever wondered how the Liability Coverage on your homeowner policy works? Or what Medical Payments would cover? What exactly is Personal Injury? You likely have most if not all of these coverages on your current homeowner policy. So, what exactly are you covered for and how much coverage do you NEED?
Liability coverage protects you against claims resulting from unfortunate accidents that cause bodily injury or property damage to someone else that either you or your children are responsible for. It also covers injury caused by your pets.
Liability coverage will protect you if someone is injured on your property, like if you forget to clear the ice from your front walkway and a guest slips and falls. It can also protect you as you are out living life, if an unfortunate event occurs accidentally that results in injury to someone else or damage to their property. For example, maybe you are golfing and don’t see your friend standing behind you. You swing…and they get a head injury. Or that golf ball gets away and breaks a window in a home bordering the golf course on the 9th hole. Other examples could include your young child is throwing rocks into the roadway and causes an accident or your horse kicking the neighbor who is trying to feed it an apple. Maybe even your dog getting nervous when the delivery guy comes to bring your Amazon package and ends up biting him.
How much liability coverage do you need? You should have enough Liability coverage to cover the value of all of your assets (that is what you are trying to protect if something unfortunate happens). Take into consideration: the value of your home, other properties you may own, your retirement, income, balance in your bank account and other investments. You should have enough coverage to protect the sum (total value) of all of these things. Your insurance agent should not tell you how much coverage to carry. We have a financial asset worksheet you can use to calculate this. *Remember that your liability doesn’t end just because your insurance is exhausted. That just means that you will pay for the rest out of your pocket.
How does Medical Coverage on your Homeowner policy work?
Medical coverage on your homeowner policy is a no-fault coverage. You don’t have to be responsible for the injuries of another person for this coverage to respond. Medical payment coverage helps reduce the number of liability claims that homeowners face. It does not, however, cover your own family’s or pet’s medical bills. Medical payments would respond if your neighbor is bringing you a homemade pie and rolls her ankle slipping while on your front walkway which is clear and dry.
What is Personal Injury and how does it protect me?
Personal Injury protects you if you or your children are found to be liable for: slander, libel, defamation of character, wrongful eviction or breach of privacy. This is more injury to someone else’s personal or professional reputation or injury to their psychological and mental health. With today’s social networking platforms such as Facebook, Yelp, Instagram, Snapchat, Twitter and others, you might be more vulnerable to a personal injury claim than you thought. Keep in mind that you are vicariously liable for your children’s behavior while on these platforms. People don’t think twice about suing one another in today’s litigious culture. Without this coverage, rising legal fees and plaintiff-friendly court systems could drain your financial assets.
Personal injury coverage is not typically included in a standard homeowners insurance policy. Personal injury is an additional coverage that you may need to add to your homeowners insurance policy to help shield you from personal injury claims.
Written by: Casey Shipley