Why do I need liability insurance in my homeowners insurance?
The standard homeowner’s policy includes liability protection which safeguards you against lawsuits for bodily injury or property damage that you, a member of your family or a pet has caused. For example, if your child or pet tears up your neighbor’s fence then you are covered, but if you, a family member or pet destroys something of yours or has a mishap that is not covered. That is considered part of your health or medical insurance coverage.
This liability part of your policy pays for both the costs of court awards and defending you in court, up to the limit of your policy. You are also covered anywhere in the world, not just in your home.
The limits on the liability insurance start at $100,000 but it is recommended that you purchase at least $300,000 worth of home insurance protection. You can purchase an excess liability policy or umbrella policy that will cover you even more. Most often, the umbrella costs from $200-$350 per year for a million dollars worth of additional liability coverage.
Your policy will also provide no-fault medical coverage in the case a friend or neighbor is injured in your home. All they have to do is submit the medical bills to your homeowner’s insurance company. This helps avoid a liability claim being filed against you. This is generally around $1,000 to $5,000 worth of coverage; however, it does not cover the medical bills for you, your family or your pet.
It is very important to talk with your insurance agent to make sure that you have enough liability insurance included in your standard homeowner’s policy.