Liability insurance protects you against the nasty consequences of accidents. As you assess your insurance needs, protecting yourself, your family, your home, as well as your car, you should show healthy respect for Murphy's Law, expecting that whatever can fail will go wrong. And, since Helpful resources goes wrong, it usually calls for the next-door neighbour's child.
Liability insurance for your car
The law requires that you carry liability insurance on your own car. If you fail to show proof adequate liability insurance, the federal government may suspend your driving privileges and soon you comply with regulations. If a law enforcement officer stops you for a routine traffic violation and you fail to provide proof insurance, you could be taken to jail as well as your car impounded.
Out there in a large world full of reckless drivers distracted by children and cell-phone conversations, your auto liability insurance is worth every penny you pay-especially your uninsured motorist protection. Putting away the legal mandate, think about the practical wisdom of liability insurance on your auto: If you caused a little fender-bender, you might absorb the costs of the other motorist's medical attention and auto repairs. If, however, the unthinkable befell and you also caused a significant accident with multiple injuries, how could you begin to afford hundreds of thousands of dollars in medical and rehabilitation costs? This insurance protects not only your body and your body as well as your car but also your entire worldly assets.
Liability insurance for your home
Your mortgage lender may necessitate that you carry liability insurance in your homeowner's package; but even though it isn't required, you should add liability coverage to the insurance on your home.
Understand that your children define "play" as "colliding with toys and each other at very high speeds." As they become more proficient in their play, they add bicycles, scooters, and skateboards, so that they more easily can achieve spectacular impact with the ground, trees, fence posts, and concrete. Once you own children bend, break, and mutilate their bodies in the course of routine play, your medical insurance covers the cost of repairing them. When the obnoxious neighbour's child sustains an injury on your own property, that very same obnoxious neighbour may bring legal action against you for negligence or reckless endangerment. In a civil trial, your more-than-ever obnoxious neighbour may ask not merely compensatory damages but also punitive damages. Judges and juries, wanting to teach allegedly negligent parents a lesson, may award substantial punitive damages even if it had been evil little Johnny Jones's fault.
Other important liability protections
If you own your personal business, your insurance package almost inevitably will include liability insurance, as you want to protect your employees and patrons from accident and injury while they look after business. As a condition of your insurance, your underwriter may require proof your business complies with all applicable safe practices codes. If some time has passed because you conducted a safety review of your worksite, you may ask your insurance professional for assistance, assuring that you meet each of the law's as well as your policy's requirements.