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Personal liability coverage

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Your property insurance policy contains several different insurance coverages. Personal liability coverage, which protects you against accidents that happen to others at your home or apartment, is likely one of them. Regardless of whether you rent or own, personal liability insurance is usually well worth it.

What is personal liability insurance?

Most homeowners, condo and renters insurance policies include personal liability coverage, sometimes referred to as “coverage E.” Personal liability coverage provides financial protection if you are found at fault or negligent for injuries to others or damage to the property of others that occurs on your premises.

For example, if you have a party and a guest trips on your rug and breaks an arm, your liability coverage would apply if you were found at fault for the guest’s injuries. The guest may be paid for medical bills, lost wages or pain and suffering from your personal liability coverage.

Personal liability coverage is purchased in dollar amounts, usually $100,000 to $500,000. Occasionally, you may have the choice to purchase higher limits of coverage on your homeowners policy. However, suppose you feel that you need additional coverage and your insurance provider does not offer higher limits. In that case, you can ask your insurance provider about purchasing an umbrella policy to extend your liability coverage.

What does personal liability insurance cover?

Incidents covered by personal liability could include:

  • A guest injures themselves on your premises.
  • Your dog bites a guest or passerby (some companies exclude liability coverage for certain dog breeds).
  • Damage to a guest’s property occurs on your premises.
  • Injuries or deaths occur on your premises due to the use of a pool or trampoline (some companies place restrictions on coverage for these items).
  • Someone slips and falls on your icy driveway or sidewalk.

It is important to note that you must typically be found negligent for injuries or damage for liability coverage to respond. For example, suppose a tree on your property falls during a windstorm and damages your neighbor’s garage. In that case, your liability insurance will likely only pay for their damages if you are found negligent for them. In other words, it would have to be proven that you knew the tree was dead or dying and could cause damage to your neighbor’s property. Otherwise, the cost of repairs would be covered under your neighbor’s policy.

Liability coverage can also be valid away from your home’s location. If you are walking your dog and it gets loose, knocking someone to the ground and injuring them, your liability coverage may still cover you, even though you were not at home.

How much coverage do you need?

Most standard homeowners policies include $100,000 to $500,000 in personal liability coverage. It may be hard to imagine exhausting your homeowner’s insurance liability limit, but costs can spiral quickly if someone is injured. Your liability coverage also protects you in other ways. If, for example, your child accidentally burns someone else’s house down, you could be liable for a substantial amount in property damage and personal injury claims. In such a situation, a lawsuit could wipe out your entire net worth, including your savings, your home’s equity and your assets.

To come up with the right amount of personal liability coverage, consider your future earnings, whether you own multiple residences and if you have teenagers, who may be at higher-risk for damages. Depending upon the assets you want to protect, it can be beneficial to consider adding excess liability or umbrella insurance coverage.

When in doubt, contact your insurance agent to evaluate coverages in your homeowners or renters policy. Read the fine print in any quote to ensure you are getting the personal liability coverage you want.

How much does personal liability insurance cost?

The average cost of a homeowners insurance policy in the United States is $1,312 per year for a policy with a dwelling amount of $250,000. The amount and percentage that pays for the personal liability coverage portion of your policy depends on your coverage limits and where you live. For example, you will generally pay more for a policy with $500,000 in liability coverage than you will for a policy with $100,000 in liability coverage.

Learn more: Affordable home insurance companies

Who needs personal liability coverage?

If you are responsible for your living expenses or have assets such as a home, savings or investments, you might want to consider adding some form of personal liability insurance to protect yourself financially. To help determine coverage amounts, add up your net worth and the value of your assets. Homeowners insurance personal liability coverage limits typically range from $100,000 to $500,000. If you have a high net worth and more assets, consider increasing your personal liability coverage or purchasing an umbrella policy.

Benefits of personal liability insurance

If you are sued for property damage or personal injury in your home or away from it, your personal injury coverage can help you pay for legal counsel to represent you, litigation cost or settlement costs. If you do not have personal liability coverage or have a low coverage limit, your out-of-pocket expenses could quickly add up in the event of a lawsuit. Your savings, house, vehicles and other assets could be at risk if you do not have the coverage to compensate the injured or damaged party adequately.

Having personal liability insurance coverage helps limit out-of-pocket expenditure if you are at fault for an accident, property damage or personal injury. It could be a critical piece of your financial plan.

How to get personal liability insurance

If you have a homeowners insurance policy or a renters policy, check your personal liability coverages and limits. As your net worth or the worth of your home and belongings increase, contact your insurance agent to make sure that you have adequate coverage in place. You may also be able to purchase a stand-alone personal liability policy if you do not have a homeowners policy.

Frequently asked questions

What is personal liability?

Personal liability insurance protects you financially if you or a family member is responsible for someone’s injuries or property damage. Many types of insurance policies contain personal liability coverage in the policies., so check with your insurance carrier.

Do I need personal liability insurance?

If you have assets you would like to protect, the personal liability insurance cost is usually well worth it. If someone is hurt in your home, your dog bites a guest or you are the cause of an accident, personal liability insurance likely covers the cost of the medical bills, their damaged items, legal fees and court judgments. If you do not have personal liability coverage, you could lose your home or other assets to pay for the costs.

How much is personal liability insurance?

There are many factors that determine personal liability insurance costs. Some of the main factors that impact how much personal liability insurance costs include where you live, the amount of coverage you need and history of claims. It may be a good idea to shop around and compare insurance quotes carefully to find the policy that offers you the coverage you need at the lowest price.


Bankrate utilizes Quadrant Information Services to analyze 2021 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Quoted rates are based on 40-year-old male and female homeowners with a clean claim history, good credit and the following coverage limits:

  • Coverage A, Dwelling: $250,000
  • Coverage B, Other Structures: $25,000
  • Coverage C, Personal Property: $125,000
  • Coverage D, Loss of Use: $50,000
  • Coverage E, Liability: $300,000
  • Coverage F, Medical Payments: $1,000

The homeowners also have a $1,000 deductible and a separate wind and hail deductible (if required).

These are sample rates and should be used for comparative purposes only. Your quotes will differ.

Written by
Cynthia Paez Bowman
Personal Finance Contributor
Cynthia Paez Bowman is a former personal finance contributor at Bankrate. She is a finance and business journalist who has been featured in Business Jet Traveler, MSN,, and
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Insurance Editor
Reviewed by
Assistant Vice President & Claims Field Manager