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
Entitlement to pension benefits without a reduction, even though an employee is no longer in the service of an employer at retirement. For example, under the ten year vesting rule, an ...
Policy that comes into existence or adjusts the amount of coverage to provide protection for newly acquired or increasing values of an insured's real or personal property. ...
Eligible employees reimbursed from the employer for family health care expenses paid by those employees to include health insurance premiums, disability income insurance premiums, and ...
Professional designation awarded by the American College. In addition to professional business experience in financial planning, recipients are required to pass national examinations in ...
Organization that underwrites insurance policies. There are two principal types of insurance companies: mutual and stock. A mutual company is owned by its policy owners, who elect a board ...
Quantitative measurement of the total costs (losses, risk control costs, risk financing costs, and administration costs) associated with the risk management function, as compared to a ...
Charge against a business firm in a product liability insurance lawsuit. Manufacturers have been held responsible for their products. When consumers become injured while operating a ...
Equity of shareholders of a stock insurance company. The company's capital and surplus are measured by the difference between its assets minus its liabilities. This value protects the ...
Person other than the annuitant as designated by the policyholder on whose life expectancy the annuity payment is also based. ...
Have a question or comment?
We're here to help.