Generally, liability insurance is designed to offer specific protection against third party claims. It differs from typical risk transference insurance as payment is typically not made to the insured, but rather to someone suffering loss that is not a party to the insurance contract. The liability portion of a homeowner's policy is designed to cover unintentional injuries on the premises and unintentional damage to other people's property. In other words, injuries caused by your negligence are covered; those you inflict on purpose are not covered.
Liability insurance is a compulsory form of insurance for those at risk of being sued by third parties for negligence.
Definition: Negligence is the failure to use reasonable care. The performance of something which a reasonably prudent person would not do, or the failure to do something which a reasonably prudent person would do under like circumstances is considered negligence. A departure from what an ordinary reasonable member of the community would do in the same community.
An intentional tort is a deliberate act that causes harm to another, for which the victim may sue the wrongdoer for damages. If the intentional torts is an act that can be prosecuted or cause arrest under current law- they are typically not covered by insurance contracts; therefore, the best risk protection method is risk avoidance.
Intentional torts involving people:
- false imprisonment
- invasion of privacy
- malicious prosecution
Intentional torts involving property:
- harm to goods or land through trespass
InsuranceFind out how different types of coverages can protect you and which policy is right for you.
InsuranceEvery business is susceptible to legal action. Find out how to protect yours.
InsuranceDon't go to work without this policy in place - especially if your work is in your home.
InsuranceProperty insurance is important, but there's a lot you need to learn in order to get the proper coverage.
InsuranceHomeowners insurance may not be enough – say, if your nanny sues for damages after an accident. That's where umbrella coverage comes in.
InsuranceStandard liability coverage may not be enough. Special needs call for specialized policies.
Financial AdvisorAdvisors spend a lot of time discussing insurance with clients but they also need to consider their own coverage needs as small-business owners
InsuranceAt low cost, you can buy significant extra liability coverage in case you're sued due to an accident or other trouble. See it as bankruptcy protection.
InsuranceCompulsory insurance is insurance a person or business is legally required to buy.
Financial AdvisorThe DoL rules provide a new structure under which advisors can be held liable for any failure in this area. Advisors are wise to consider other insurance.