Did you know that your home insurance most likely covers you in case there is an accident in your home or on your property? But when would you need this and do you need additional coverage over and beyond what your policy already covers? Let’s take a closer look at how you can protect you and your family’s assets from any liability lawsuits:
What is liability insurance and what does it cover?
Personal liability insurance is generally a small piece of your homeowner’s insurance policy and covers you in case of an accident that occurs on your property, as well as some accidents that could occur away from your property as well. For example, this could cover someone who trips and falls over you in a parking lot or your child hitting someone in the eye with a baseball at the park. But these policies don’t cover intentionally harmful acts like vandalism and assault. This insurance also does not cover you if the accident happens in your motor vehicle as your auto insurance should cover that.
Why should you have it?
Oftentimes the equity in your home is your biggest asset and therefore is a prime target for someone wanting to sue you. Many insurance policies provide $100,000 to $300,000 of coverage which may seem like a lot, but oftentimes lawsuits can make their way into the multi-millions.
When should I purchase more than what my homeowner’s policy already provides? First, check your policy or contact your agent to find out how much umbrella coverage you have. Most insurance companies allow you to purchase additional umbrella coverage should you feel that you need it. Liability insurance should cover your entire net worth in order to protect you fully, especially if you own a pool or a boat or entertain large groups of people in your home.
How should I handle a liability lawsuit?
If you ever are involved in an incident or do receive something that looks like you could be being sued, contact your insurance company as soon as possible. Their claims department can review the situation for you and let you know if they will cover your particular situation or if you will need to contact an attorney yourself. The benefit of having umbrella liability insurance is that rarely will you be very involved with the case once you have provided the initial information to the attorneys.
If you have questions about your homeowner’s insurance policy and how much personal liability insurance it includes, contact your insurance agent for additional information and to make sure you and your family are fully protected.