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Coverage E - Personal Liability Coverage
Homeowners Insurance protects not only tangible things such as your home and your possessions, but it also embraces legal relationships between and among people with respect to things and helps settle conflicts over accidents that occurred on your property. The problems pertaining to settling up such relationships is the application domain of Personal Liability Coverage.
Personal Liability Coverage comes into force in the event of your liability for injuries and damage you cause to other people, not members of your household. You may not be directly involved in doing harm to others or damaging their property. Even though it is not intentional, if it happens on your property, you assume responsibility for it. Accordingly, Personal Liability Coverage protects you against bodily injury and/or property damage to others on your territory for which you are legally responsible. This coverage will pay the claims and will cover the services of a lawyer who will defend you in the event of a lawsuit. Among the optional benefits offered under Personal Liability Coverage can be reimbursement for accidents that happen off the premises.
The Liability section of your Homeowners Insurance policy can be split in two parts: Home Insurance Personal Liability and Home Insurance Medical Payments.
The Personal Liability section reflects the provisions made to protect you and all the family members living with you against claims or lawsuits resulting from bodily injury or property damage to others. The reasons for an accident can be various beginning with different mishaps caused by weather phenomena to incidents due to the unsafe condition of the policyholder's property and the policyholder's negligence. Personal Liability Coverage will help you cover the associated costs.
The Medical Payments section is aimed at covering medical expenses for people accidentally injured on your territory, such as X-rays, checkups, ambulance charges, hospital stays and visits, and similar expenses. In some policies it is offered as a separate coverage. In any case, the Medical Payments section is not applicable to injuries you or members of your household sustain.
In fact, it is very difficult to estimate your exposure to liability risks to determine the amount of Personal Liability Coverage you need, but if you own some property, there is always a risk of being sued. It should be borne in mind that for you to get financial protection and compensation for being sued, a legal judgement should deem you responsible for someone's injury or personal property damage.
The amount of Personal Liability Coverage provided by a Homeowners Insurance policy is usually stated per occurrence, i.e. for a single accident or, in some cases, for damage resulting from a prolonged exposure to the same set of conditions. Under the contracts of this type there is usually a monetary limit that is paid off per incident. The typical limit amount under a Personal Liability Coverage contract is within the range of $100,000 to $300,000. A lower amount of coverage is considered inefficient as in this case there is a very real possibility that your assets will be put at risk. Just on the contrary, it is usually recommended to increase your coverage. An umbrella policy is specially designed to provide an extra measure of security increasing your coverage above the amount of the underlying Personal Liability Coverage. Umbrellas can range from $1,000,000 up to $20,000,000.
All the types of Homeowners coverage have their exclusions and limitations. Personal Liability Coverage is not an exception. All the limits and exclusions are specified in your policy. Among the usual restrictions you can find the following. As it was mentioned, there is a dollar limit per incident. Additional coverage can be added, but it involves extra premium costs. Personal Liability Coverage is not applicable to intentional injuries or damage the insured intentionally brings to other people's property. Besides, Personal Liability Coverage does not reimburse you for any financial loss related to injuries to animals, damage to motor vehicles, watercraft, aircraft and parts of them. Nor does it cover losses due to floods, earthquakes, blackouts and damage resulting from war or nuclear hazard. Liability for business activities and professional services is covered by other, more specific policies. Exclusions specific to Coverage E embrace any injury covered by Workers Compensation Insurance as well as contractual liability under which the insured agrees to assume legal responsibility for injuries sustained by resident employees outside the insured premises.
A peculiar feature of this type of coverage is that normally it does not require a deductible. Therefore, in financial terms, to bring Coverage E of your Homeowner's Insurance into effect you are just to pay the premium.
You cannot foresee or prevent any accident. Just imagine for a second a great variety of perils that can befall your visitors. Even if you take precautionary steps to minimize the risk of bringing harm to other people, you cannot eliminate it altogether. That is why do not overlook Personal Liability Coverage in your Homeowners policy. It can be a source of comfort to you and people around.