What Is Personal Liability Insurance and How Much Does It Cost?
Personal liability coverage is part of most homeowners insurance policies.
It protects you if someone is injured on your property, or if you damage their property at your home or theirs.
You can buy extra coverage to protect your assets for a relatively low rate. Adding an extra $1 million of liability coverage to your home insurance policy will raise your rates by an average of $53 per year.
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What is personal liability insurance?
Personal liability insurance helps cover the costs if someone sues you if they're hurt on your property or if you damage their property. It's included in most homeowners, renters and condo insurance policies. You can also buy a stand-alone personal liability policy.
What does personal liability insurance cover?
Your personal liability insurance kicks in if someone gets hurt or you damage someone else's property as a result of your own negligence. If you need to file a claim, your policy will cover the injured person's expenses, such as:
- Medical expenses
- Repairs to damaged property
- Lost wages
If they sue you for their injuries, your personal liability coverage should also pay for at least some of your legal fees.
What does personal liability insurance not cover?
Personal liability insurance doesn't cover things like:
- Your medical expenses
- Costs tied to intentional injuries or damage
- Damage caused by your business
- Damage to your property itself
- Injuries caused by certain dog breeds
- Injuries that happen on property you rent
You can find the full list of things that your homeowners insurance doesn't cover by reading through your policy. If you need help, talk to your insurance agent or company to learn more about what your policy covers.
Your personal liability coverage through your homeowners policy won't cover you if you're in a car accident. For that, you'd need a car insurance policy with bodily injury protection and property damage coverage.
How much does personal liability insurance cost?
Personal liability insurance is typically included in your home or renters insurance policy, up to a certain limit.
This is because most standard homeowners and renters insurance policies include at least some personal liability coverage.
If you want to buy more liability insurance for added protection, you can, but it’ll cost you extra.
How much does additional personal liability insurance cost?
Buying more personal liability coverage should only cost you a few dollars more per month. This is especially true compared to other homeowners insurance changes, like raising your dwelling coverage limit. The table below outlines the cost of raising your personal liability coverage limits on a home with a $100,000 policy with State Farm.
Personal liability coverage | Annual homeowners insurance rate | Cost of increased coverage |
|---|---|---|
| $100,000 | $1,023 | - |
| $300,000 | $1,033 | $10 |
| $500,000 | $1,040 | $17 |
| $1 million | $1,058 | $35 |
Tripling your personal liability coverage from $100,000 to $300,000 could cost you as little as $10 more per year. The exact amount will depend on where you live and other factors. That said, you shouldn't see a drastic increase in rates when raising your personal liability coverage limits.
If you're interested in buying more coverage, you'll want to look for an umbrella policy. Umbrella policies provide supplemental coverage, meaning they only pay out after you've hit your homeowners or auto insurance policy limits.
Even though umbrella policies provide much higher coverage limits, the cost for personal umbrella liability policies remains low. You can expect to pay anywhere from $150 to $300 per year for $1 million of coverage.
How much personal liability insurance should you have?
Your liability limit should be as high as you can afford, to lower the risk of financial loss if someone sues you. Most home insurance policies include up to $100,000 of personal liability coverage, which might not be enough if you get sued.
Category | Amount |
|---|---|
| Personal liability coverage | $100,000 |
| Personal injury or property damage claim brought against you | $400,000 |
| Costs you have to pay | $300,000 |
If you have assets of $100,000 or more, consider an umbrella policy or personal excess liability insurance. Both are forms of supplemental coverage with higher limits.
In other words, an umbrella policy or personal excess liability insurance kicks in after you reach your homeowners coverage limits. An umbrella policy provides broader coverage, while personal excess liability insurance adds coverage to the underlying policy.
In the scenario above, an umbrella policy or personal excess liability insurance would cover the remaining $300,000, protecting your assets. Coverage limits will depend on your policy.
Frequently asked questions
What are the benefits of personal liability insurance?
Personal liability insurance helps protect you from potentially expensive lawsuits and helps you pay for any property damage or injuries people suffer in your home. The coverage keeps you from having to pay for their medical bills, repairs and other similar expenses.
Is there a deductible for personal liability insurance?
Most personal liability insurance policies don't have deductibles. If you need to file a claim, contact your insurance company and let them know what happened. They'll typically cover your expenses up to the policy's coverage limits.
What is an example of a personal liability claim?
If your dog runs outside and bites someone down the street, your policy would provide coverage. Or, say you're running at the park and accidentally knock someone over, causing them to break a bone. Their medical bills would be covered under the liability portion of your home insurance if you're found responsible.
Does personal liability insurance cover car accidents?
No, personal liability insurance through your homeowners insurance policy or renters insurance policy won't cover car accidents. Your car insurance policy will cover injuries and property damage caused by your car if you have the right types of coverage in place.
Methodology
To determine the average cost of personal liability insurance, ValuePenguin got quotes from the largest insurance companies in Illinois across all ZIP codes in the state. The quotes are for a 45-year-old married man with no claims as a homeowner and the following coverage limits:
- Dwelling coverage: $200,000, $350,000, $500,000 or $1 million
- Personal liability: $100,000
- Medical payments: $5,000
- Deductible: $1,000
ValuePenguin used Quadrant Information Services to get the quotes. Quadrant gets rates from publicly-available insurance company filings. Keep in mind that prices vary based on a number of underlying factors. Your quotes will likely be different.
Editorial Note: The content of this article is based on the author's opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.
