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What Is Personal Liability Coverage?

By August 11, 2021September 30th, 2021Umbrella insurance

Whether you rent an apartment or own a home, personal liability coverage will protect you against accidents that happen to others while they are visiting you. The cost for liability protection is included in a standard homeowners policy and amounts to just a few dollars per month.

It is no secret that lawsuits can be costly, potentially taking everything you own. Fortunately, personal liability with your homeowners insurance can save you from a financial disaster, so it is essential coverage that should be part of a well-thought-out financial plan.

Here is how personal liability insurance protects you:


What does personal liability insurance cover?

Personal liability insurance protects you in three ways:

  1. It protects your present and future assets: Personal liability is available through your homeowners insurance, condo insurance, or renters insurance policy. It will provide your defense coverage if any action is brought against you—whether or not you are responsible—and it helps pay your legal defense fees.
  2. It provides coverage for lawsuits: Personal liability provides coverage for lawsuits you could encounter resulting from an accident with bodily injury to others on your property or caused by you.
  3. It protects you and your family for their actions: Personal liability covers you and your family members for their actions on and off your property and worldwide. This coverage includes accidents and things that happen through your negligence.


Who needs liability protection?

The short answer is that anyone who lives independently and is responsible for their actions should have personal liability coverage. The cost of personal liability insurance is minimal, while the risk of not having this coverage could be significant.

If you believe you do not need coverage now because you have nothing to lose, think about this: Your future assets are also at risk. Suppose you are held liable for a personal injury or property damage. In that case, you could lose your existing assets—property and investments, for instance—plus your future earnings could be garnished and any future assets affected.

If you are forced to go to court, even for a false accusation, personal liability coverage will pay the cost of your legal defense.


What is covered by personal liability on your home insurance?

Here is a list of what is typically covered by the personal liability portion of home insurance:

  • Medical bills: Personal liability coverage can help pay medical bills that result from a visitor’s accidental injury at your home.
  • Lost wages: If a visitor’s injury on your property results in them not being able to work, liability insurance could pay those lost wages if you are found legally liable.
  • Defense Costs: If you are sued after an accident in your home, personal liability can help cover your legal expenses.
  • Damages caused to others: Your liability coverage extends to members of your household, your pets, or those working on your behalf if they cause injury to others or damage their property.
  • Personal liability coverage away from home: For example, if you accidentally damage a hotel’s lobby and they seek reimbursement.
  • Death benefits: If an accident in your home fatally injures someone, your policy may cover a death benefit to their family.


What Is Not Covered by Liability Coverage on a Homeowners Policy?

The liability coverage provided on your standard homeowners policy can be confusing. For example, liability insurance might cover you while operating a watercraft that you do not own. On the other hand, depending on the boat motor’s size, the length of the boat, or the conditions under which you operate it, your watercraft might not be covered.

Other things, such as a motor vehicle, are excluded from your liability coverage. Your auto insurance policy must cover liability for driving a car. Cars are always excluded from personal liability on your home insurance policy.


Increasing Your Personal Liability on Your Insurance Policy

Because of the low cost of liability coverage, it is usually a good idea to take the maximum amount of available coverage. Ask one of our insurance experts at White Cloud Insurance to review your homeowners policy to suggest the liability coverage that fits your specific needs.

Just fill out our contact form, call us at 305-556-1488, or send us a message at