What is Liability Insurance?
Liability Insurance is an insurance policy that protects an individual or business from the risk of being sued or similar claims by the third party. This policy is needed in case if of bodily injury, property damage, or other wrongs due to the action or inaction of the insured. In addition, if you have a business that deals with high-risk activities such as construction, production of sharp objects and so on, you surely need to have a certain level of liability insurance.
What is more, if you are an employee working for such company that deals with high-risk activities, then they might be able to protect you with employer’s liability insurance.
What is covered under Liability Insurance Policy?
Liability Insurance Policies typically cover both legal and any legal costs for which you are found legally liable. Liability Insurance also covers the accidental injuries caused during your work. For example, if you injure your leg or arm while carrying equipment during your work time, liability insurance will cover the injury cost for you. Intentional damages or similar intentions are not covered by these type of policies.
4 Main Types of Costs Covered by Liability Insurance
Property Damage – In case if you are at fault in an accident and you caused damage to the other car, Liability Insurance will cover all the expenses of its recovery.
Medical Costs – In case if you hurt somebody while driving, Liability Insurance will cover the costs of medical bills.
Lost income – This one is a little different from the examples above. In case you are an employee who will not be able to work for a long time, Lost Income Liability Insurance will let you claim your lost wages.
Legal costs – In case you need to defend yourself against a claim or other legal actions, Liability will pay all the required costs for you.