When you think homeowners insurance, you may first envision protection for your house against fallen trees, flooding and other natural disasters. But parts of your homeowners insurance policy are specifically designed to help protect you legally. For example, if Nancy Neighbor slips and falls on wet leaves in your driveway or some other potential injury claim against you, you could be held accountable. That means if she decides to sue, you could be liable for attorney fees to defend the claim, court expenses and possibly even her medical bills; assuming she can prove you were legally negligent which is harder than you may think. However, if you've purchased enough personal liability coverage, your homeowners insurance policy could really pay off.
What is personal liability?
If someone is injured on your property, even if you're not home, you could be held legally liable. That means if they decide to sue, you could face devastating bills on your own. Here are just a few expenses that come with a bodily injury lawsuit:
• Court costs and legal fees. It costs a lot to get sued, even if your case never sees the inside of a courtroom. When you're hit with court filing fees, marshal's fees, investigator's fees, medical records and report fees, court reporter's fees, travel costs, consultant fees and more, it doesn't take long to rack up a huge tab at your lawyer's office.
• Property damage. If a guest is parked in your driveway and a tree falls on his or her car, you could be liable for the cost to repair the damage.
• Medical bills. If Nancy Neighbor breaks her hip after tripping on one of your kids' loose toys in the yard, you may have to foot the bill for her surgery and any subsequent treatment.
Depending on how much personal liability coverage you purchase, these expenses could be covered by your homeowners insurance policy should you ever face a bodily injury lawsuit and file a claim.
How much coverage should I get?
Typically, a standard homeowners insurance policy includes a minimum of $100,000 per liability claim occurrence. However, many homeowners choose to purchase $250,000 or more in coverage depending on their specific needs. For example, if you have a swimming pool or a trampoline on your property, you may have a higher liability risk than a homeowner who doesn't. If you feel the need for protection against libel, slander, defamation of character, invasion of privacy or other threats, you may require a separate umbrella policy.
When does it pay off?
Here are just a few examples of when being covered with personal liability coverage can pay off big when you need it the most:
• Your dog FiFi bites off more than you can chew when she attacks the mailman in your yard. He hits you with a multi-thousand dollar lawsuit to cover his subsequent ambulance ride, emergency treatment and post-operative care. Your personal liability insurance covers most of the expenses so instead of paying off a $20,000 lawsuit, you'll be in the clear.
• One of your children's friends decides the area around your pool is the perfect place to practice cartwheels while you're not home. His parents sue you for negligence in addition to damages for the hefty hospital bill resulting from their child's injury on your property. Your coverage can help you stay afloat during the settlement, but it's probably a wise investment to install a locked gate or fence around the pool to prevent accidents like this.
Personal liability insurance typically is part of a standard home insurance policy. You'll be glad it is if you're ever the subject of a lawsuit because of an injury on your property. But you should still study your policy - or ask your agent - to decide whether you have enough coverage.
This article was contributed by Carrie Van Brunt-Wiley, Editor of the homeinsurance.com blog. Carrie has been writing insurance news and consumer information for HomeInsurance.com since 2008. She graduated from the University of North Carolina in Wilmington in 2005 with a B.A. in Professional Writing and Journalism.