What Is Personal Liability in Homeowners Insurance?
Personal liability coverage is essential to home insurance policies, protecting you from financial repercussions if an accident causes injury or property damage to a guest in your home.
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By Mark Fitzpatrick
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Head of Insurance, MoneyGeek
Mark Fitzpatrick is a Licensed Property and Casualty Insurance Producer and MoneyGeek's Head of Insurance. He has analyzed the insurance market for over five years, conducting original research and creating personalized content for every kind of buyer. He has been quoted in several insurance-related publications, including [CNBC](https://www.cnbc.com/2020/04/15/cant-keep-up-with-insurance-premiums-heres-what-to-do.html), [NBC News](https://www.nbcnews.com/business/autos/flooded-cars-are-problem-their-owners-future-car-buyers-n1278493) and [Mashable](https://mashable.com/article/tesla-insurance-rates). Fitzpatrick earned a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He is passionate about using his knowledge of economics and insurance to bring transparency around financial topics and help others feel confident in their money moves.
Edited by Casie McCoskeyCasie McCoskey is a professional editor passionate about providing people with accessible information on personal finance. Before MoneyGeek, she worked in the legal field, drafting and editing briefs and motions.
MF
By Mark Fitzpatrick
MF
Head of Insurance, MoneyGeek
Mark Fitzpatrick is a Licensed Property and Casualty Insurance Producer and MoneyGeek's Head of Insurance. He has analyzed the insurance market for over five years, conducting original research and creating personalized content for every kind of buyer. He has been quoted in several insurance-related publications, including [CNBC](https://www.cnbc.com/2020/04/15/cant-keep-up-with-insurance-premiums-heres-what-to-do.html), [NBC News](https://www.nbcnews.com/business/autos/flooded-cars-are-problem-their-owners-future-car-buyers-n1278493) and [Mashable](https://mashable.com/article/tesla-insurance-rates). Fitzpatrick earned a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He is passionate about using his knowledge of economics and insurance to bring transparency around financial topics and help others feel confident in their money moves.
Edited by Casie McCoskeyCasie McCoskey is a professional editor passionate about providing people with accessible information on personal finance. Before MoneyGeek, she worked in the legal field, drafting and editing briefs and motions.
Updated: August 7, 2024
Advertising & Editorial Disclosure
All standard home insurance policies include personal liability coverage, which protects you, the homeowner, from losses if you unintentionally injure or damage someone else's property at home or elsewhere. Whether it's an accident in your living room or an unforeseen event in your backyard, personal liability insurance has got you covered. With such coverage in place, homeowners can find solace in knowing that their financial stability remains protected.
Personal liability insurance is part of every standard home insurance policy, covering the costs of accidental injuries or property damage sustained at home.
Personal liability coverage does not include car-related damage, intentional damage, damage as a result of neglect or business-related issues.
To determine your personal liability coverage, consider your lifestyle, risk tolerance and the value of your assets.
Personal liability insurance is an integral component of home insurance, designed to shield homeowners from financial liabilities if they unintentionally injure someone or damage another person's property. This coverage is not an optional add-on; it's a fundamental component of every standard homeowners insurance policy. From unforeseen incidents like a child's friend getting injured while playing in your yard to damages caused by household pets, personal liability insurance offers an essential layer of security.
In a home insurance policy, personal liability coverage pays for any accidental injuries or property damage in your home or resulting from your actions. It covers several scenarios, including:
Injuries You Cause
Personal liability insurance can cover injuries occurring on your property and accidents away from home. For example, your policy will cover associated medical expenses if a visitor trips on your walkway and sustains an injury. Coverage also remains active even when you're away from your residence. For instance, if you accidentally injure someone at a park, this coverage can address the medical bills and potential legal costs.
Injuries Caused by Your Pets or Children
Should your pet or child inadvertently cause harm to someone, this insurance can cover the medical costs. For example, if a dog jumps on a guest, leading to an injury, the coverage can address the medical bills. Note, however, that some insurers limit coverage to certain breeds only.
Personal liability coverage also pays for accidental property damages, like a spilled drink damaging a visitor's personal item.
Property Damage Affecting Other Homes
Events originating from your property, like a tree branch falling and causing damage to a neighbor's shed, are addressed by this coverage.
Personal liability insurance, like all insurance policies, has its boundaries. Understanding these limitations is crucial for homeowners to ensure they're adequately protected.
Personal liability insurance doesn't extend its coverage to car-related incidents. For such situations, auto insurance is the primary source of protection.
Operating a business from your home brings its own set of risks. Personal liability insurance typically doesn't cover these business-related liabilities. Instead, a dedicated business insurance policy is required.
Deliberate actions that result in harm or damage, such as vandalism, fall outside the purview of personal liability coverage.
Personal liability insurance doesn't cover injuries sustained by household members within the home. Individual health insurance policies would cover these kinds of injuries.
Certain scenarios, such as injuries caused by specific breeds of dogs known for their aggressive tendencies, might not be covered, depending on the specifics of the insurance policy.
While home insurance’s personal liability coverage offers a broad range of protections, being aware of its limitations ensures that you can take additional measures if needed. Before purchasing a policy, consult an insurance professional to ensure you get coverage for your home and all your assets against potential risks.
While most standard homeowners policies offer a range of $100,000 to $500,000 in personal liability coverage, the amount you should opt for depends on your circumstances. Getting at least $100,000 in liability coverage costs a few more dollars per month, which is better than shouldering the costs of medical expenses.
Remember, life's unpredictabilities, such as injuries on your property or damages due to accidental actions, can lead to substantial claims. Beyond medical expenses, there could be legal fees, compensation for pain, suffering or lost wages. Take this into consideration when determining your coverage.
Personal liability coverage is already part of standard home insurance policies. However, you can easily increase the limit if your current coverage is insufficient. As life evolves and assets accumulate, it’s essential to periodically review the amount of personal liability coverage in your policy.
To purchase a home insurance policy, follow the steps below:
Begin your journey by determining the extent of homeowners insurance coverage you require. Consider factors such as the type of home you own, its location and the value of your possessions.
Decide on the dwelling coverage and personal liability limits of your policy. Ensure that the coverage can adequately address potential damages or losses.
Beyond the standard offerings, consider if you need additional coverages like flood, earthquake, or specific endorsements. These can be crucial based on your home's location or specific risks.
Gather essential details about your home, such as its address, appraisal information and any prior insurance details. This information will help in obtaining accurate quotes.
Don't settle for the first quote you receive. Compare home insurance quotes from various insurance providers to ensure you get the best value for your money.
Once you've chosen a policy, iron out the specifics, including the billing plan, deductible and the policy's start date.
With everything in place, finalize your homeowners insurance application. After paying the initial premium, your coverage will commence from the policy's start date.
To determine how much personal liability coverage to get, reflect on your lifestyle and potential risks. Some things to keep in mind include:
Your risk exposure is a critical element in determining your coverage level.
Ensuring the right amount of personal liability insurance is not just about meeting policy requirements; it's about safeguarding one's financial stability and peace of mind. Our frequently asked questions navigate the intricacies of personal liability coverage in home insurance.
Will homeowners insurance cover a civil lawsuit?Yes, homeowners insurance typically covers civil lawsuits and any settlements or judgments up to your policy's liability limits if a plaintiff sues you for a covered incident.
When is liability coverage included in a homeowners policy?Liability coverage is a standard component of most homeowners insurance policies, designed to protect against financial losses if someone gets injured on your property or due to your actions.
Does homeowners insurance cover personal injury to the homeowner?No, homeowners insurance generally does not cover personal injuries sustained by the homeowner. Instead, it primarily covers injuries to guests or third parties on the property. However, in some instances, the policy may cover personal injury to the homeowner, depending on the incident. Clarify with your provider what events are covered.
Do you have to pay a deductible for personal liability claims?Typically, there is no deductible for personal liability claims under a homeowners insurance policy. However, reviewing your specific policy details is essential to confirm.
