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What Is Homeowners Insurance Personal Liability?

Accidents don’t just happen in your car, and when they happen in your home, they can still be costly. Fortunately, liability coverage in your home insurance* helps protect you and family members who reside in the home. We’ll discuss what you need to know about homeowners insurance personal liability coverage, how much you should have and what can be covered.

What is homeowners insurance liability coverage?

In homeowners insurance policies, the term “personal liability” is used to describe a homeowner’s potential legal liability arising in connection with the use of your home, or the acts of your resident family members, for negligence resulting in bodily injury or property damage to a third party. Notice that this type of personal liability insurance doesn’t cover bodily injury or property damage that you cause to yourself or your family members, or to your own property. While it’s called personal liability insurance, it’s meant to cover your liability for bodily injury or property damage to others. This coverage protects the members of the insured’s household both on and off insured locations, unless they’re involved in activities that are specifically excluded.

Included in the liability section of the homeowners insurance policy is the insurer’s duty to defend. This means that the insurer has a duty to provide an insured with defense to claims made against a liability insurance policy, even if coverage is in doubt. If it’s determined that coverage doesn’t apply, the insurer’s duty to defend ends.

What is covered and not covered by home insurance liability?

Homeowners liability insurance covers situations where you or a member of your household has caused unintended damage to a neighbor’s property. For example, if a tree that you’re cutting down on your property falls on your neighbor’s car, you could be held liable for the cost to repair any damage. In instances like these, your liability coverage would cover any claims made against you. Another example of where liability coverage could play a role is if your dog bites a friend visiting your home. It’s difficult to explicitly write a list of instances covered by home insurance liability, as this type of coverage depends on the circumstances of the situation. However, you can get an idea of what may be covered by looking at what isn’t covered. In most homeowners liability insurance policies, the following aren’t covered:

  • Intentional acts
  • Business pursuits
  • Professional liability
  • Ownership, maintenance, use loading or unloading of an excluded vehicle, watercraft or aircraft
  • Damage to property rented or occupied by an insured
  • Bodily injury or property damage to any resident of the household other than a Residence Employee
  • Bodily injury to any person covered by workers’ compensation
  • Transmission of a communicable disease
  • Sexual or physical abuse
  • Vicarious liability imposed on a parent for the use of an excluded vehicle, aircraft or watercraft by a minor
  • War

What happens if someone is injured in your home?

If someone is injured on your property due to your negligence, you can be liable for medical bills and other expenses. First, you should call emergency services if warranted. Otherwise, give them first aid as needed. Then, contact your insurance company as soon as possible. Your insurer will investigate all potential injury claims and keep you informed throughout the process.

Do you have enough homeowners liability insurance?

The basic limit for homeowners insurance personal liability is $100,000 per occurrence. However, this may not be enough to fully cover you in the case of a large liability claim. How much liability insurance you need can depend on your financial situation and assets. If you have a lot of assets to protect, you should carry a liability limit in line with those assets. Exactly how much liability coverage you need can help be determined by a financial adviser. At Amica, we typically recommend carrying at least $300,000 in coverage. This would also qualify you for a personal umbrella policy, which can provide you with an additional amount of liability coverage. Coverage from an umbrella policy can provide an extra layer of protection if damages exceed the underlying homeowners personal liability limit.

How much does homeowners liability coverage cost?

While it’s hard to say exactly how much liability coverage costs as a portion of your homeowners insurance premium, you’d likely be surprised by its affordability. How much liability coverage you carry is a determining factor in how much it’ll cost in premium. If you have prior homeowners insurance claims, this can make various coverages more expensive.

When accidents happen, they can be costly. Liability insurance coverage can provide a valuable layer of protection for you and the members of your household. Most importantly, your liability protection follows you wherever you go, worldwide.

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* This product is not available in AK and HI.

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