What kind of liability coverage is provided by a typical homeowner's policy?
A typical homeowner's policy includes $100,000 of liability insurance, which won't go far if someone is severely injured. For a slight increase in premium you can raise that to $300,000 to $500,000, and some companies offer coverage of $1 million or more. Typically, coverage includes harm caused by your children and pets, except intentional harm if the child is over thirteen. If your pet attacks people routinely, the insurer may cancel your policy or refuse to renew it.
Most standard homeowner's policies do not cover:
- employees and clients of your home-based business, including the children in your home-based day care if you take in more than three children and have no special endorsement;
- claims by one member of the household against another;
- any disease you pass on to someone.