How Much Liability Should I Have on My Home Insurance Policy?

When homeowners think of their home insurance policy, they generally think about dwelling and property coverage. There is a third type of coverage, however, that is just as important. 

Personal liability insurance protects you and your family in case of a lawsuit concerning bodily injury and property damage someone else may suffer on your property. 

For example, say you host a party. One of your guests slips and falls down the stairs, hitting their head and breaking their wrist. When they’re rushed to the hospital, it is discovered that they also have a concussion. Since the accident happened on your property, you could be held liable for the injury. Personal liability insurance will step in to pay the guest’s medical bills related to the injury. It will also help you with legal expenses if the injured guest decides to sue for the damages instead. 

So how much should you carry in personal liability? 

It depends. A typical home insurance policy covers $100,000 in liability insurance. You may want higher coverage depending on your needs, however. Consider your: 

Lifestyle 

Do you host a lot of parties? Do you have frequent guests or host physical activities such as yoga or group exercises? The more people you have over, the more you are liable for a lawsuit concerning an injury. While you may not think that the people you’re inviting over will sue, you can never be too sure when it comes to a severe injury and it’s better to be safe than sorry—both for you and your guests. 

Pets and Kids 

Liability insurance doesn’t just cover basic trips and falls. It also covers damages caused by you or your family members—including the furry ones. 

Say your beloved dog is a tad anxious around strangers, especially men. You invite friends over and one of the men goes to pet the dog before you can warn him. Feeling trapped and scared, your dog bites. Dog bites can be vicious. Even small ones need medical treatment. Personal liability insurance can cover expenses related to a dog bite. It can also cover expenses related to injury or property damage your child may cause. For example, if your kids are playing baseball outside and a stray baseball flies into a neighbor’s window and hits them, this insurance can pay for the damages, injury and possible legal fees.