If you’re like most homeowners, the importance of homeowners insurance is obvious. If your home is damaged as a result of fire, theft, lightning, heavy snow, or high winds, your homeowners policy would likely cover the cost of damage. But, did you know that your homeowners policy may also protect you from property damage or injury for which you are legally responsible? To understand the scope of a typical homeowners policy, consider a few hypothetical situations in which personal liability could become an issue:
- Your daughter is away at college and leaves her stuff all over the floor of her dorm room. A dorm counselor comes into the room, trips over the objects, and is injured in a fall. The counselor decides to sue you or your daughter for injuries.
- Your son lets a friend walk his dog while he stops to help a neighbor. At the end of the block, the dog gets upset and bites a young child playing on the sidewalk. The parents of the young child initiate legal action against you as the dog’s owner.
- You send your housekeeper to the grocery store. In the parking lot, she loses control of a shopping cart that strikes an elderly man, causing him to fall and break his hip. The man seeks legal action against you for the recovery of medical expenses.
- You are cutting down a tree on your property. The tree falls in an unexpected direction and lands on the roof of your neighbor’s house. The neighbor moves to a motel while the roof is being repaired and sues you for property damage and motel expenses.
Unwrapping the Package
Part I of a typical homeowners policy covers damage to your property. However, you may be surprised to learn that Part II of the standard homeowners policy includes comprehensive personal liabilityinsurance. This coverage can help protect you and your family should negligence on your part cause injuries to others. The policy provides protection up to a stated limit for bodily injury to others and property damages for which you are legally liable, as well as for legal defense expenses in the event of a lawsuit.
Now, let’s revisit each of the four scenarios:
- In the first situation, under the definition of “insured location,” a family member is covered for negligence in a temporary residence. Under most policies, a dorm room is considered the temporary residence of a college student.
- In the second situation, liability protection extends to individuals who are legally responsible for (or have your permission to use or control) your animals or watercraft. Consequently, you and your son’s friend would be covered in the second situation. However, if your son’s friend took the dog for a walk without a family member’s permission, your policy’s liability coverage may not cover the friend.
- The third scenario is a covered event because the injury was caused by a “residence employee” (your housekeeper) in the course of being employed by you, the insured. Coverage extends to such persons away from the insured location (the covered residence).
- In the fourth scenario, you would be covered for damage you caused to someone else’s property, including any loss of use arising from that damage.
Ultimately, although it may contain some exclusions and limitations, the personal liability section of your homeowner’s policy provides important protection for your “home sweet home.” If you expect to purchase a home in the near future, or wish to review your current coverage, be sure to give your insurance agent a call. They will be happy to assist you with all your insurance questions and needs.