Property Liability Insurance in Ontario
Your house is where you are safe. It’s your shelter from the raging elements, your sanctuary from the stress of work, and your shield against the prying eyes of society. So it is fitting then, that your house is also the best way for you to protect yourself from most types of legal action in Ontario, through the wonderful coverage known as Property General Liability.
Liability in General
Did you know that you owe a “Duty of Care” to all people who come onto your property, even trespassers? Or that you could be sued for millions, even if you never intended to cause harm? It is scenarios like these, and many others, which gave rise to the inclusion of liability insurance as part of your property policy. This coverage, although it is on your property policy, is actually best described as personal liability insurance, as it actually represents coverage that will protect your personal actions, regardless of where you are in the world.
Personal Liability Insurance covers all people listed on your home insurance policy, as well as a few other people who may need to be covered by your policy in special circumstances (people who have temporary custody of your property after your death, people held liable for damages caused by a pet or boat which is covered under policy, etc).
Your Personal Liability policy will follow you anywhere in the world, and provides you coverage for your own actions, as well as liability arising from property you own. It also protects you while you operate small motorized vehicles, even when you don’t own the vehicle itself!
The basic premise is this liability insurance will cover you against legal judgment awarded against you because of your negligence. This (and most types) of liability insurance also will pay for the costs of arguing a case, as well as any court costs. This alone can justify purchasing liability limits, as the cost of undergoing a trail is extremely high.
Now although the liability coverage provided to you by your home policy is very broad, there is an exhaustive list of exceptions where you will be provided no coverage. We will discuss a few of them, but this is by no means a full list.
Because Car Insurance is readily available and because of the huge costs of lawsuits related to Automobile accidents, your home policy will not provide coverage to you when you operate an automobile (or any other large or plated vehicle, like a snowmobile or ATV). Make sure you get an auto policy to have liability coverage on the roads.
Owned Property not on Policy
If you own a building and don’t get an insurance policy on it, you aren’t going to get any coverage from any pre-existing policies. This includes locations like apartments you own (or are renting for a sustained period of time), and second homes or cottages. Not naming owned buildings on the policy but reaping the benefits of coverage is unfair to the insurance company, so they make sure it is never the case.
Liability Assumed by Contract
This one is fairly obvious, if you agree to take on a liability for someone’s actions, you won’t be covered for that under your policy. There is business liability insurance available when you (or your business) are taking on liability due to the actions of others (employees or contractors), but you won’t be covered with just your home policy.
Costs & Extensions
Your liability component of home insurance can be fairly inexpensive, and can vary wildly from person to person. However, because liability is not clearly connected to the size of your home, you will generally see everyone paying a roughly similar amount for their Personal Liability Insurance. In Ontario, you can also increase your liability limits quite cheaply (it can be less then $30 per year in some cases), which can be a great way to improve the your insurance policy. You can also purchase an “Umbrella” liability policy, which acts as extra liability coverage in excess of your home policy’s limits. An Umbrella policy also applies to your Auto policy, so it is common for families to have a Home, Auto and Umbrella policy to ensure they are covered in the event of a lawsuit. Check out our quoting tool or give us a call at 1-800-361-0941 if you are interested in an Umbrella policy, or taking a closer look at what liability insurance you have.
This is the first of several articles to deal with the concept of liability in insurance, check back here for articles on Liability Insurance in Ontario, Auto General Liability Insurance, Commercial General Liability Insurance and even an article on Liability Facts!