Personal Finances

Get the Facts: Important Liability Insurance Facts You Need to Know

Your homeowner’s insurance policy probably doesn’t cover flooding, but it does cover volcanic eruptions and meteor strikes.

As much as that sounds like science fiction, these are indeed true insurance facts. In fact (see what we did there?), you’d probably be surprised at how much you don’t know about the world of insurance policies.

For example, how familiar are you with liability insurance? What is it, who needs it, and what does it mean for you and your family?

Keep reading for some interesting facts about liability insurance.

What Is Liability Insurance?

Liability insurance gives you protection against claims if someone or something gets injured or damaged. In other words, the insurance protects you legally if you’re connected to a situation that results in injury or damage.

Here are three common settings for liability insurance:

  • Liability car insurance protects you if you cause an accident that injures someone or damages their vehicle
  • Personal liability insurance through your homeowner’s policy protects your current and future assets
  • Professional liability insurance protects healthcare workers and other professionals who give counsel
  • Business liability insurance protects your company if someone gets injured on your premises

Liability insurance covers the legal costs and payouts that the policyholder would otherwise be responsible for.

Who Needs Liability Insurance?

If you own a home or a car, liability insurance is usually included with your auto or homeowner’s policy.

Medical professionals (doctors, dentists, surgeons, etc) or professional advisers (IT consultants, insurance agents, etc) also need to purchase liability insurance. This protects them and their businesses from accusations of malpractice, negligence, or misrepresentation.

The good news is that liability insurance is one of the more affordable types of coverage in the insurance world. To find out how much you’ll need to pay, you can request a free liability insurance quote.

Other Surprising Insurance Facts

Beyond these settings, some people choose to carry personal liability insurance for other unforeseen events. 

For example, what if you accidentally start a fire in a hotel room? Or what if you strike someone with a ball during a round of golf? Liability insurance will help to cover any claims.

People who choose to take out personal liability insurance (beyond their homeowners and auto policies) are usually high-net-worth individuals. In other words, their personal assets exceed the upper limits of their insurance policies — often $1 million or more.

Employer’s insurance and worker’s compensation also fall under the umbrella of liability insurance. There are also commercial liability insurance policies that protect companies (or their employees) from libel and slander.

Protect Yourself: Don’t Skimp on Insurance

Insurance is one of those things you’ll hopefully never have to use — but you’ll be grateful for it if you do.

Now that you know these facts about liability insurance, the next steps are up to you. Make sure that you’re protected in your car, in your place of business, and in your personal life.

Looking for more interesting insurance facts or business and marketing advice? Keep browsing our blog for other insightful articles.


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