When you talk about homeowners insurance, a lot of folks just sort of go glassy-eyed. They ask what the best rate they can get is and still make the mortgage company happy, and then they go on about their merry way. They don’t want to think about personal liability versus medical liability, yet these kinds of issues are at the very heart of what makes up homeowners insurance.

Personal Liability

Don’t click away just yet. Give me a paragraph or two to try to break this out a little bit for you, OK? It’ll be worth it the next time you stare doe-eyed at your insurance agent.

Personal liability is coverage that you have for when someone makes a claim or a lawsuit based on a personal injury that happens on your property, damage to someone else’s property caused by you, or personal damage caused by you outside of your property.

Personal liability coverage doesn’t include accidents involving a motor vehicle, and it doesn’t cover accidents that occur when the incident is somehow business related. This coverage does protect you as well as family members that live with you.

Medical Payments

The medical payments section of your homeowners insurance policy is a little bit different. It includes coverage that will pay the medical expenses if someone is injured on your property, even if you’re not at fault. This portion of your homeowners insurance policy doesn’t apply to you or to people in your family that live in the home.

The amount of coverage for medical payments, as well as the deductible, will be different than your personal liability coverage. Knowing which category a given injury falls into makes a big difference.

Exclusions

You also need to know that your homeowners insurance policy likely has a number of built-in exclusions. They usually exclude payments for things like an injury to an animal or pet, damage to a car, losses from flooding or sewer backups, damage from nuclear material, damage from power failures or problems like dry rot, vermin infestations or earthquakes.

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