Personal liability insurance protects your financial health if you are responsible for injuries or property damage to others.
Written by Barry Eitel
Barry Eitel
Barry Eitel is a content writer and journalist focused on insurance, small business and finance. He has researched and written about personal finance since 2012, with a special focus on entrepreneurship, freelancing and other small business operations. His writing on insurance and small business has been featured in 7x7, Brit + Co, Intuit Quickbooks, Bankrate, Policygenius and Lendio.
Reviewed by Nupur Gambhir
Nupur Gambhir
Nupur Gambhir is a content editor and licensed life, health, and disability insurance expert. She has extensive experience bringing brands to life and has built award-nominated campaigns for travel and tech. Her insurance expertise has been featured in Bloomberg News, Forbes Advisor, CNET, Fortune, Slate, Real Simple, Lifehacker, The Financial Gym, and the end-of-life planning service.
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If a guest is injured at your home, you might be on the hook for their medical expenses — or your own legal bills if they sue you. But thankfully, your homeowners insurance policy covers you when you’re financially responsible for damages. An essential part of homeowners insurance policy is personal liability coverage. Policies generally cover accidental bodily injury or property damage caused by covered household members outside the home as well.
Personal liability insurance is included in homeowners insurance, renters insurance, and other types of home insurance policies. Coverage includes everything from a dog bite to a baseball accidentally hit into a window. Personal liability protection ensures your family isn’t financially burdened even if they are found liable.
Read our full guide to understand what personal liability insurance is and why you need it.
Personal liability coverage is a part of homeowners and renters insurance policies and covers the cost of damages you might be liable for, such as medical bills and property repair.
The personal liability portion of your policy will also cover the cost of defending a lawsuit and judgments that come out of the lawsuit if you are sued, up to your policy limits. Its main purpose is to protect your assets if you are found liable for unexpected damage.
Key Takeaways
Every homeowners insurance policy includes family liability protection. That means the policy protects you and your family if anyone is found liable for bodily injury or property damage. This generally includes incidents that happen on or off your property, assuming they are accidental.
Even if an accident wasn’t your fault — for example, a neighborhood kid jumped too hard and hurt themselves on your trampoline or a party guest wore the wrong kind of shoes and slipped on gravel in your driveway — a court can still find you responsible. This is where family liability protection becomes extremely important.
There are a few different incidents that personal liability will cover:
Bodily injury to others is covered by your personal liability insurance. It takes care of your legal responsibility when someone is injured in or around your home. For example, if someone fell down the stairs in your home or slipped on an icy sidewalk.
Liability works in conjunction with the medical payments (sometimes called guest medical) portion of your homeowners policy. Medical payments to others help pay for reasonable and necessary medical expenses of non-residents who are accidentally injured on or around your property. Your personal liability insurance covers any claims of negligence that caused the injury or a lawsuit.
Guest medical typically covers (up to your limit):
Liability coverage will pay for accidental damage you do to someone else’s property. For example, your child throws a baseball through the neighbor’s window, and it damages an expensive piece of art. Liability would pay for both the window and the art piece, up to policy limits.
Anyone considered a household member and lives in your home would be covered by your policy. This includes your spouse, children, parents who live with you, and employees who work in your home, such as childcare providers. Oftentimes, this also includes pets — so if your dog bites someone, you can use personal liability insurance to cover the medical or legal bills.
Notably, tenants are not covered, so if you rent out a portion of your home, your tenants will need their own renter’s insurance policy to be protected.
Personal liability offers coverage for a wide variety of situations. Here are a few of the most common claims, as well as a few unexpected claims that would also be covered:
Here are a few uncommon occurrences that are also covered:
Homeowners, condo, and renters insurance have exclusions. For instance, residents of the home can’t a medical claim with homeowners insurance for slipping on their icy front porch. Instead, the injured party would need to place a claim with their own health insurance provider for the resulting medical bills.
Also, your home vehicles are not covered under either the personal property or liability portion of a home insurance policy. So, while a neighbor can make a claim if your child throws a baseball and it breaks a window of their vehicle, if it happens to your vehicle, you cannot make a claim under your home policy. You could make a claim under your car insurance policy’s comprehensive coverage.
And to be clear, any intentional acts are not covered. For example, if you push someone down your staircase, you will be on your own for all bills associated with the incident.
Each home policy has its specific list of exclusions, so read over your policy in its entirety to find what yours are and call your agent to be sure.
The majority of homeowner policies come with at least $100,000 in liability, but this is the low end of the coverage. If a serious fall or injury were to happen in your home, medical expenses would quickly eat up this amount of protection, to say nothing of the cost of a lawsuit.
Most experts recommend upping your limits to at least $300,000. The medical payments portion has its own limits as well. The amount of medical payment coverage you can purchase varies by the insurance company, but at least $5,000 is recommended.
Yes — personal liability coverage protects you in case of injury or destruction to someone else’s property. Personal liability is usually included as part of your homeowners policy. You might also see it listed as family liability insurance. Generally, both types of policies will cover everyone in your household, but check the fine print to make sure.
Yes, you need personal liability insurance once you’re a homeowner. The good news is that it’s built into your homeowners, renters, or condo insurance.
You may think, “How am I going to be responsible for damage to somebody else’s property?” But you could have a tree in your yard, after a big storm, fall into a neighbor’s home. That new trampoline you bought for your kids could become unmoored in that big storm and go flying into the neighbor’s living room window.
The personal liability coverage part of your homeowner’s insurance would likely cover any of those accidents and pay for your neighbor’s damages.
Surprising as it may sound, no.
That said, if you’re showing off in front of your kids, and you go skateboarding in your kitchen, and you forget that the door to the basement is open, and down the stairs you go, you probably weren’t planning on suing yourself or a family member for negligence. And you have health insurance, right? Boy, we hope so.
And keep in mind – that if your kid’s friend happened to be on a skateboard and went careening down some stairs or over your coffee table – and injured himself – your personal liability coverage would cover those hospital bills and any possible lawsuit.
Personal liability coverage, all in all, doesn’t cost all that much, but the cost of not having it when you need it can be very high.
Yes, personal liability insurance is worth it. If someone is injured at your home, if you have a dog that bites a guest or if you are to blame for any accidents happening on-premises, this coverage will help pay for the medical bills or any kind of bodily injury or property damage you cause to others.
