What is personal liability coverage?
Personal liability coverage, sometimes referred to as personal liability insurance, protects you financially if you're responsible for damages or injuries to others. This protection extends to household relatives, so if your child accidentally damages your neighbor's property, you may be covered. Personal liability coverage is a standard part of your homeowners insurance policy and is also included in renters and condo insurance policies.
What does personal liability coverage cover?
Personal liability coverage may cover the following:
- Injuries on your property: If you're legally responsible, your personal liability coverage may help pay for someone else's injuries that occur on your property — up to the limits of your policy.
- Damage to others property: Applies if you or your household relatives are at fault for the damage. For instance, your child hits a baseball through a neighbor's expensive stained-glass window.
- Lawsuits and lawyer/court fees: If you're sued over an accident, your personal liability coverage may help pay for a lawyer and legal expenses, as well as any settlements against you.
- Dog bites (varies by insurer): Check with your insurer to see if they cover dog bites. Many insurers won't cover dog bites, while others may limit coverage to certain breeds.
What isn't covered by personal liability coverage?
Some personal liability claims may not be covered, including:
- Car accidents: Your auto liability insurance, rather than your personal liability coverage, covers you for damages or injuries you cause while driving.
- Intentional harm or damage: Injuries or damages you or a household member purposely cause to someone else are not covered.
- Your own injuries or damages: Personal liability coverage doesn't apply to accidental injuries or damages you cause to you or your family. Instead, your health insurance or property insurance may apply.
- Business claims: Any claims against you that relate to your business or profession are not covered by personal liability coverage.
How much personal liability coverage do I need?
Homeowners and renters policies commonly offer three limits of personal liability coverage: $100,000, $300,000, and $500,000.
As with auto liability coverage, selecting a coverage limit that matches or exceeds your net worth is a good starting point. For instance, if your total net worth is $150,000, you should opt for at least $300,000 in coverage to fully protect your assets. If you need more than $500,000 in personal liability coverage, an umbrella insurance policy can extend your limits beyond those of your homeowners insurance or auto insurance policy.
You should also consider how risky your property is: Do you own a swimming pool? Do you have a trampoline in your yard? These are called attractive nuisances for good reason; they raise the risk of a child wandering onto your property and injuring themselves. So, if you have any enticing backyard features, consider raising your personal liability coverage limit to offset the increased risk.
Learn more by using our home insurance calculator to quickly calculate coverage limits for a homeowners insurance policy.
How much does personal liability coverage cost?
Personal liability coverage may be the least expensive part of a home insurance policy. In general, you can increase your limit without drastically raising your monthly premium. Learn more about what goes into the cost of homeowners insurance.