If you're a homeowner, it's important to know the potential incidences you can be found liable for, both on and off your property. Accidents can get expensive quickly, so making sure you're protected from any potential lawsuits is extremely important—and that's exactly what your personal liability insurance is for. It protects you financially from accidents you're found legally responsible for, including accidental bodily injury or property damage.

But what exactly does personal liability insurance cover? And when should you consider taking out an extra policy to make sure you're fully protected?

Unfortunately, the lines for personal liability insurance coverage aren't completely black and white. Personal liability insurance coverage can vary from situation to situation, so knowing what is covered in your policy—and what isn't—is important to ensure you're fully protected.

This overview should help you better understand how your personal liability insurance works, how much it costs, and what types of scenarios this policy will and will not cover.

How Much Does Personal Liability Insurance Cost?

The price of personal liability insurance can vary quite a bit, depending on a number of factors including your physical location, exposures, coverage levels, and more. It's usually fairly inexpensive to purchase a higher limit for personal liability coverage, so if you're worried about exceeding your limit, consider looking into your options. We recommend reaching out to a personal liability insurance agent in your area for a personalized quote.

Can You Max Out Your Personal Liability Insurance Policy?

Let's say in February, your close friend falls down your stairs. Your personal liability insurance kicks in to cover the cost of their medical bills, which quickly add up due to her multiple broken bones. Then, in August of the same year, a neighbor kid trips on your garden hose while running through your yard and again racks up some pretty big medical bills for the stitches he needs. Will your personal liability insurance cover multiple accidents?

While there is a coverage limit per claim, your policy limit resets for each isolated incident. So in this situation, your policy would cover both accidental injuries up to the policy limit for each case. Anything above your policy limit for each incident will be your responsibility to pay for.

Make Sure You're Protected From These Unpredictable Situations

You never know when you're going to find yourself in one of these tough situations, which is why it's better to be over-prepared in case the worst does occur. While your personal liability insurance is a great starting point, if you have young children or a property that has increased risks—like a high retaining wall or a backyard trampoline—it might make sense to take out an additional umbrella policy.

Umbrella insurance policies can cover costs that surpass your personal liability insurance amount. In other words, it's a great way to double down on personal liability protection. Aside from increasing your coverage, you can also keep your property in good condition to avoid potential injuries the best you can.

Now, let's dive into a list of common situations that personal liability insurance will—and will not—cover so you can be prepared for any future incidences.

What Does Personal Liability Insurance Cover?

Let's start with situations that ARE covered by your personal liability insurance policy.

1.      A neighbor kid gets injured while jumping on your trampoline.

This type of incident is typically covered, although some carriers may have trampoline exclusions in place. If you plan on purchasing a trampoline, you should discuss it with your insurance agent first. Some carriers will specify that you must have a fence or a net to be covered, which is something your agent can inform you of before you make your purchase.

2.      A house guest falls down the stairs.

Like the scenario above, as long as it's an accident (and not a scene from the movie Psycho), this incident will be covered by your personal liability insurance policy. This would also cover any other falls on the property, including tripping over uneven sidewalks, slippery floor mats, and the like.

3.      Your dog bites a visitor in your home.

If your dog happens to bite someone—for whatever reason—your personal liability will usually cover any legal payments as well as any medical expenses up to the policy limit. But it's important to note that most carriers have a "dangerous dog" list that will prevent you from getting coverage, and some carriers have exclusions for claims arising from those animals. It's best to consult your agent first to make sure you're selecting a pet that doesn't fall on this list, or have a conversation if you do plan on adopting one of these "dangerous" breeds.

It's also important to note that exclusions can apply to other types of pets as well, especially "exotic" ones like reptiles, rodents, and birds. We recommend you familiarize yourself with your policy and consult your insurance agent with any questions.

4.      You host a party and one of your intoxicated guests takes a bad fall.

Any visitors who get injured in your home can find you at fault, but your personal liability insurance should kick in to cover these types of injuries. That is, as long as you stay on your property. Of course, the lines get a bit more blurred if you move the party off your premises, or if you hire someone else to serve the alcohol. If you have concerns about this type of situation, you should address them with your insurance agent prior to your event.

5.      You're at the golf course and hit a ball into somebody's living room window.

Yikes! This is every golfer's worst nightmare, but you can rest easy knowing that you would be covered in this situation. Even though you're not on your own property, your personal liability insurance would kick in to cover the cost of the damage. This also applies to medical bills, should you hit somebody with your ball instead and they require stitches.

What Does Personal Liability Insurance Not Cover?

Now that we've covered five situations that are covered, let's dig into five common scenarios that often aren't.

1.       You rear-end someone in a highway collision.

This type of accident is covered in your auto insurance policy, not your personal liability insurance, which is why keeping your auto insurance up-to-date is super important. Driving can be rather unpredictable, so having a good auto insurance policy is key to keeping you and your assets safe.

2.       You trip and fall on the front steps of your home.

Any injuries to you or an immediate family member won't be covered under your personal liability insurance policy, because of course, you can't sue yourself! So whether your children are playing too rough or you trip and fall on your welcome mat, personal liability insurance won't help cover the medical expenses, so please be careful.

This is also the case for any injuries sustained while working from home. While more people are working out of home offices these days, personal liability insurance won't cover any business-related injury. Commercial insurance would need to be in place for coverage, so seek it out if you have this type of exposure.

3.       A neighbor's tree falls on your deck.

If a storm blows in and your neighbor's tree falls and damages your deck, your neighbor most likely won't be found responsible, as a fallen tree is usually considered an act of God. Unfortunately, you'll have to go through your property insurance to get reimbursed for this damage.

4.       You get in an accident while riding your e-bike.

What many people don't realize is that personal liability insurance excludes many self-propelled vehicles, which includes e-bikes. You'd need to have an auto insurance policy in place for those types of vehicles to be covered. These policies are evolving quickly as new forms of electric vehicles enter the market, so the best thing you can do in these situations is to consult your insurance agent directly with any questions.

5.       You're mowing the neighbor's lawn when a rock shoots up and breaks their window.

Once your lawn mower is taken off your property, it's no longer covered by your personal liability policy, meaning you'd be on the hook for any damage or medical bills your equipment causes. This also includes other vehicles designed to service a residence, such as skid loaders and snowblowers.

Get Fully Covered With Christensen Group

As always, Christensen Group is here to help you decide which insurance policy makes the most sense for your lifestyle. Don't let an unforeseen circumstance leave you in debt—contact us today to talk through your options and get a free, personalized insurance quote.