Personal Liability Insurance 101

A personal liability insurance policy is meant to help protect an individual from a liability lawsuit in the event that someone is hurt on his or her property or personal vehicle. A personal liability policy covers both bodily injury and compensation to the injured party. This type of insurance policy goes above and beyond the standard coverage provided by one’s homeowners and/or auto insurance policies. Each person in the household who are insured by your primary homeowners and auto policies will be protected by this type of coverage.

Who Needs Personal Liability Insurance

It is possible for any individual to be sued as a result of actions that cause harm whether the actions are involuntary, unintentional or otherwise. Unless you have insurance to cover injuries to another person, it is possible that if you are sued, the judgment may specify that the money owed to the injured party will come out of your future earnings. Additionally, a court may rule that a person's assets can be seized to pay the injured party. For these reasons, anyone who owns a home or vehicle should consider a personal liability umbrella policy.

What Are Your Options

Premiums for a personal liability insurance policy is dependent on the amount of protection you want along with the size and cost of the property owned. Additionally, the premiums will vary based on the number of people the policy will protect. The more protection you want in terms of dollar amount, the higher the annual or monthly premium will be. If you have your homeowner's/renter's policy and auto policy with one agency, you may be able to add umbrella insurance which covers personal liability. In most cases, this is a less expensive way to have personal liability protection. Considering the fact that personal liability insurance can provide thousands, or even millions, of dollars worth of coverage, this type of umbrella policy will pay for amounts not covered by homeowners or auto insurance in the event of a catastrophe. It is always wise to compare pricing of including the additional umbrella of personal liability to your other policies as opposed to obtaining a separate personal liability insurance policy.


Be sure to get a copy of your policy in writing and speak to your insurance agent about what your policy would exclude before you agree to the coverage. When purchasing any insurance, you need to know exactly what the policy will and will not cover.


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