The best personal liability insurance for homeowners

Methodology

Insurance Business America has engaged the country’s top brokers in one-on-one interviews and surveys to determine the leading Home Insurance products. IBA’s inaugural Five-Star Excellence Award celebrates companies not only with outstanding product offerings, but also first-class broker support and industry knowledge. The Five-Star Excellence Award allows brokers to understand the partners their peers have chosen to present to clients – giving you an upper hand when selecting insurers to work with.

• Chubb
• Travelers
• Pure
• Safe Co
• AIG
• The Cincinnati Insurance Company
• Auto-Owners

What is personal liability insurance?

Personal liability coverage is an essential component of homeowners insurance as it provides financial protection for the owner and the residents of a household against claims of bodily injury or property damage that they may be held legally responsible for. These claims could include medical and legal expenses, as well as costs for unintentional damage policyholders or their family members may be held liable for on someone else’s property.

For instance, if a someone gets injured by slipping or falling down inside a person’s property, or a family member unintentionally breaks an expensive item by throwing something through a neighbor’s window, then the policyholder may be made to pay for the cost of the damages.

Is personal liability insurance the same as general liability insurance?

Both personal liability and general liability policies provide protection from claims involving bodily injuries and property damage. The main difference, however, is that personal liability insurance covers for injuries or damages that the insured is personally held responsible for while general liability policy, which is also called commercial general liability insurance, pays for the costs incurred from bodily and property harm associated with a business’ operations.

For example, personal liability insurance will pay for medical costs when someone accidentally falls down the stairs on a person’s home, while general liability policy covers the medical and legal expenses incurred if someone gets hurt inside or within the premises of a commercial establishment due to negligence on the part of the ownership.

How much personal liability coverage do homeowners need?

The amount of personal liability coverage homeowners need typically depend on the level of liability-related risk the property is exposed to and the total value of the owners assets.

Nice-to-have home features such as swimming pools, hot tubs, outdoor spas, trampolines, and treehouses are considered inherently liability risks for guests, especially children, and therefore push up premiums.

Additionally, in a lawsuit, the aggrieved party can go after a person’s assets not limited to those related to the insured property, but also all their other valuable possessions. If an owner has multiple properties, their personal liability policy should be able to cover the combined value of those properties.

What does homeowners personal liability insurance cover?

Personal liability insurance offers coverage for claims of bodily injury or property damage that a homeowner is held legally liable for. It protects policyholders from financial losses incurred from medical expenses resulting from the treatment of injuries and legal costs arising from litigation, settlement, and payment of damages. Most policies also cover family members and residents of a household for their actions within and outside the premises.

Among the occurrences personal liability insurance covers are accidental or intentional bodily injury inflicted on or by guests in a property, a tree from the homeowner’s premises falling on a neighbor’s house, dog bites or any property damaged caused by the canine, and inadvertent or deliberate damage caused on someone else’s property by the owner or their family members.

Most insurance policies pay for medical expenses, cost to repair property damage, a claimant’s loss income, life insurance death benefits for the claimant’s family, and legal fees.

Is personal liability insurance the same as umbrella insurance?

Umbrella insurance is a type of personal liability coverage that protects against claims that standard personal liability insurance does not cover. This kind of policy covers bodily injury and property damage, but coverage can extend beyond physical harm such as libel, slander, false imprisonment.

Similar to personal liability insurance, umbrella insurance coverage also extends to the policyholder’s family members and residents of their household. It does not, however, protect the policyholder’s property, which is covered by building or dwelling insurance.

What is the average cost of personal liability insurance?

Most insurance providers offer liability limits starting at $100,000. Premiums typically cost about $10 annually, although the price may slightly rise depending on where the policyholder lives. Coverage can also reach $500,000 with a corresponding increase in premiums.

For those needing increased liability protection, it is advisable to get a personal umbrella insurance.

The year in home insurance...

Top 10 home insurance providers in the US

Data analytics firm J.D. Power reveals the best home insurance companies in the US when it comes to customer satisfaction.

Helping HNW clients understand their personal cyber risk

A report discusses how high-net worth individuals can protect themselves from cybersecurity threats.