There is a great deal to consider when reviewing liability coverage. If someone comes into your home and slips, injuries may be a result of this incident. If the person files a lawsuit against you and you lose the case, you may have to pay that person money for those injuries. This means you are "liable."
Liability coverage in your policy does several things. Most obviously, it pays the damages that are awarded to the other person when you are found to be liable for bodily injuries or property damage. The maximum amount the policy pays is shown on your policy's declarations page.
The policy also pays for the cost of an attorney to defend you, with no limit, and any other court costs associated with the suit. The basic limit of liability coverage that is included in a homeowner or tenant policy is $100,000. Higher limits are available for an additional charge.
So how much coverage should you purchase? In theory, you need to buy coverage that covers any potential lawsuit. Of course, you'll never know the actual amount of protection necessary, so I recommend purchasing as much coverage as your budget allows. The primary objective when purchasing liability coverage is to protect your assets: the value of your property, your current and future earnings, and all assets you may own. In many cases, securing what is commonly referred to as an Umbrella Policy is necessary for higher limits of coverage.
Contact The Coleman Agency today to review your exposure and plan to protect your future.