Liability Insurance
Definition of "Liability insurance"
Liability Insurance is a type of coverage present in Home Insurance as well as other fields of insurance.
In Real Estate, Liability Insurance refers to coverage protecting the insured from legal claims enforced by third-parties. For instance: if someone gets hurt inside your house and sues you for it (remember, this is America…) it will be the Liability Insurance portion of your Homeowner’s Insurance policy that will determine if you are covered or not for the legal and medical expenses that person will claim against you.
Typically people settle for Liability Insurance of up to $100,000. However, it’s a better idea to go with the $300,000 option, even if your house is not that big, as medical and legal bills are expensive and can eat that value fast. Remember, safety is not exactly related to the size of your house. It’s not just the pool area with the trampolines that can lead to accidents. A rusty nail, a glass door or a wet floor can do the trick and you don’t want to get caught on the bitter end of bills; better not to save when choosing the amount of your Liability Insurance coverage.
Liability Insurance coverage is even more important when we're talking about Commercial Real Estate. Imagine your clients or your employees having an accident on your premises! Knock on wood!
Real Estate Tip:
A great way to avoid liabilities is to seek professional help. Find a real estate agent to get protected through your home buying process!
Popular Insurance Terms
Circumstance under which the insured maintains that, if an insurance policy covers at least two scheduled items of real or personal property, in the event of a loss applicable coverage ...
Option clause in a disability buy-out insurance policy that permits the owner of the policy to increase the limits of coverage for the expenses associated with the buy-out process. Usually, ...
Enacted on April 1, 1997; provides protection against creditors for irrevocable trusts provided that the trust has a grantor who is a discretionary beneficiary. In order for the statute of ...
Membership organization of individuals especially trained in the application of actuarial mathematics, including compound interest, annuities, life contingencies, measurement of mortality ...
Addition to reflect exposures with a greater probability of loss than standard exposures. For example, insuring a munitions factory obviously requires a premium greater than that required ...
Year in which an annually renewable insurance policy was first issued. ...
Organization of brokers and securities dealers in the over-the-counter market operating under the auspices of the Securities and Exchange Commission (SEC). Its purpose is to enforce, on a ...
Policy that pays a specified sum not related in any way to the extent of the loss. The term applies to a life insurance policy rather than to a contract of indemnity because the former does ...
Agreement named after the city of Boston under which insurance companies insure real property in lower socioeconomic neighborhoods if property owners correct any hazards found upon ...
Have a question or comment?
We're here to help.