This is part two of our post answering the question, “How much home insurance is enough?”
Personal Liability (Coverage E)
Coverage E – personal liability – is arguably one of the most important parts of a standard home insurance policy. It provides coverage for third-party injuries and property damages caused by you, your pet, or a member of your household both on your property and away from home. Though there are some exclusions for things like auto and boat accidents, personal liability largely provides broad coverage for homeowners.
Types of Losses
Here at Patriot Insurance, we know that losses can occur in the most unexpected ways. Dog-bite related injuries, for example, are among the most frequently filed claims, and Minnesota ranks sixth in the nation with an average cost of those claims exceeding $38,000. Of course, personal liability can climb much higher than that – particularly for extensive property damages and severe injuries involving medical bills, rehabilitation, and lost wages. That is why we recommend purchasing high-limit personal liability coverage of at least $100,000 to $300,000.
Though high-limit personal liability insurance does not directly protect your home or belongings like other sections of your home insurance policy, it does provide indirect protection against loss by safeguarding homeowners against the financial responsibility of a lawsuit. Without adequate coverage, any damages that exceed the limits on your policy could fall squarely on your shoulders. That could mean draining your savings accounts, selling off your assets, or making payments from future wages for years to come.
For help determining how much personal liability coverage is right for you, contact our office today.
Medical Payments (Coverage F)
When guests are injured at your home, they should get the medical attention they need right away. Under Coverage F of a standard home insurance policy, third-party injuries occurring on your property are covered regardless of fault – usually for an amount between $1,000 and $5,000. This may be enough to pay for a health insurance deductible or cover the cost of an emergency room visit.
As a policy-holder, you have the option of enhancing your standard coverage with endorsements that provide additional coverage or benefits. These narrow coverage enhancements are designed to meet the needs of specific groups of homeowners, unlike the broad coverage automatically included in a standard policy.
Most homeowners can benefit from home insurance endorsements, but it is important to talk with an agent here at Patriot Insurance to determine which ones are right for you. Some are suggested for nearly all homeowners, such as water backup and sewer coverage. Others, such as a home business endorsement, may only be appropriate for certain policy-holders.
Beyond Home Insurance
Adequate home insurance limits can go a long way in protecting your house, belongings, and family, but there are some scenarios when coverage can still come up short. Many homeowners choose to supplement their home insurance policies with additional coverage – particularly increased personal liability protection available through an umbrella insurance policy.
This separate coverage provides secondary liability protection that kicks in when you reach the limits on your primary coverage. For example, if you have a $300,000 liability coverage limit and are sued for $750,000, your home insurance would not even cover half of your financial responsibility. In this case, an umbrella policy could pay the remaining $400,000 debt – all without affecting your income or assets.
Most homeowners can qualify for a $1 million umbrella policy for just $200 per year or less. To find out more about this important coverage or to get your free quote, contact our office today.