Liability Insurance

• The liability portion of a homeowner's insurance policy is similar in nature to liability auto insurance. This type of insurance covers the policy holder in the event of an unintentional accident or incident that injures another person or damages someone else's property while he is on your property.
  
  

Covered Situations

• Liability coverage typically extends to negligence, such as a loose brick on your porch that causes a guest to fall and hurt herself. Liability insurance usually covers harm caused by a child who is under the age of 13 years. Liability insurance generally covers non-recurring damage or injury caused by a pet, such as a dog bite, provided the dog is listed on the policy and does not have a history of vicious behavior. Liability insurance may also cover natural disasters, such as a windstorm that blows a tree down on a visitor's car parked in your driveway.
  
  

Situations That Are Not Covered

• The liability portion of homeowner's insurance usually does not cover injuries to the policy holder or members of his family who reside in the home. Homeowner's liability insurance will not cover costs associated with transmitting communicable diseases. Liability does not cover intentional acts. Homeowner's liability insurance will not cover liability claims for home business incidents, so individuals who operate a day care center out of their homes or entertain clients in their homes should consider business liability coverage in addition to their homeowner's policy.
  
  

Considerations

• The coverage on many homeowners' liability insurance policies is typically limited to $100,000, according to the American Bar Association (ABA). The ABA notes that rising medical costs may make that level of insurance inadequate and advocates increasing liability coverage to between $300,000 and $500,000. Individuals who need additional coverage may consider an umbrella policy that provides liability protection over and above that provided by the policy holder's auto and homeowner's insurance policy.