Some stand by the fact that baseball is America’s sport but the popularity of football has some people questioning that notion. Each year, two teams converge in the ultimate game, the Super Bowl. It doesn’t matter whether you’re a fan or not, if you like football you will probably be there to watch the game. It’s become a tradition for even those not that interested in the sport to gather just for the camaraderie, good food, and often, the alcohol. If you’re thinking about hosting a Super Bowl party, you might want to check your state’s laws on homeowner liability for drunken drivers. It may seem bizarre but the Insurance Information Institute reports that “37 states have enacted laws or have case law that permit social hosts who serve liquor to people who subsequently are involved in crashes to be held liable for any injury or death.” The limits of the responsibility will vary state to state but just knowing that you might have to pay for something that happened nowhere near you should have you running to your homeowner’s policy to check your liability limits.
Normally, your home insurance is going to cover any non-vehicle related personal liability claims that happen at your home and elsewhere. So how can you be charged if someone is in an accident? The states have coined a term for your involvement: social host liability. This allows the injured to seek damage on your homeowner personal liability coverage because you provided the alcohol did nothing to stop the intoxicated driver. It may not seem fair but for some state residents, it’s a reality. This is why it’s always important to maintain the right amount of liability because you never know when someone is going to try to get money from you.
When you purchase your homeowner’s policy, you may specifically be thinking about the damage that could occur to your home. This is in fact the structure that you’re insuring but homeowners’ policies come with a perk and that’s your personal protection. It doesn’t cost much and can save you from financial ruin. It could arguably be the most important part of your insurance policy. Accidents happen all the time and if they involve injury, many people don’t hesitate to collect compensation because medical bills are out of this world expensive. Even if no harmful intent existed, if your dog bites your long time neighbor who’s been to all your daughter’s birthday parties, there’s a very good chance she will expect you to pay for her damages. Whether that causes a relationship rift will depend on the people but if you aren’t properly insured, the biggest rift it could cause might be between you and your wallet!
Choosing the Right Limits
For a standard policy, most personal liability limits will be around $100,000. That may seem like a lot for many people and could even cover your neighbor’s dog bite wounds and the time she was out of work but what if your state has social liability laws? If you have a Super Bowl party and your best friend drives home drunk, collides with another car and kills someone, will $100,000 cover the amount you could be sued for? Not likely. Even if they seek reparation under your friend’s insurance first, if she’s underinsured you will be the next target. That’s why it’s best to make sure you set the right personal liability limits.
Things to Consider
To do this, there are several things you need to think about. You should ask yourself how much you are worth. This isn’t the time to start thinking about your existential value mind you. Instead, look at your income, look at your property value and other assets you have. How likely is it that someone could garnish a fair amount of money from you? If it’s highly likely, you should raise your personal liability limits tomorrow
Peace of Mind
You have to be comfortable with the liability limit that you choose. If you are living with a $100,000 policy limit but are constantly plagued by the thought of putting someone’s eye out with your lawnmower and being sued for everything, you might want to raise your limits. The cost to do this isn’t that expensive and if it helps you sleep better at night, it’s totally worth it.
Setting the right personal liability limit is a personal decision but speak with your insurance agent to determine the amount that fits you best. They will be able to help you figure out how to combine all the financial and emotional aspects into a policy that will cover you no matter what. A good place to start is $500,000 if you can afford it. Medical bills are costly and continually rising and some states allow the injured to seek reparations for pain and suffering as a result of the injury. You can see how one can build upon another and a simple accident can lead to the destruction of everything you’ve worked for. If you’re properly insured, you won’t have to worry about that. Check your limits today and if you think they need to be higher, don’t hesitate to protect yourself.