LIABILITY INSURANCE

liability insurance

Defined as insurance coverage that supplies an insured party with protection against claims ensuing from damage and injuries to other individuals or property, is the term liability insurance. Liability insurance policies cover any legal costs and payouts if findings propose an insured party responsible for said damage or injury.

However, liability insurance coverage does not include contractual liabilities, intentional damage, and criminal prosecution. Liability insurance, unlike other forms of insurance policies, pays third parties, and not policyholders.

Automotive insurance polices, product manufacturers, and those that practice medicine or law are required to have liability insurance. Although, most common knowledge of liability insurance is automobile related, there are a few other types of liability insurance.

These other types of liability insurance policies include workers’ compensation, personal liability, and commercial liability. At Pepper & Odom, P.C., our knowledgeable personal injury attorneys have decades of experience in handling all types of accident cases and can advise you on the best way to protect yourself with liability insurance.

How Much Liability Insurance Do You Need?

Every state is a little different in terms of legal requirements on liability insurance. Generally, bodily injury liability and property damage liability are the typical requirements for most.

However, around half of states require uninsured/underinsured motorist coverage, and personal injury coverage is required by over a dozen. As far as how much liability insurance coverage you should have, experts in auto insurance recommend at least 100/300/100.

Essentially, this breaks down to $100,000 in bodily injury liability per person, $300,000 in bodily injury liability per accident, and $100,000 in property damage liability per accident. 

In the state of Mississippi, the law requires that all drivers must maintain liability insurance and carry proof of insurance in their vehicles at all times. As well as maintaining coverage, Mississippi law requires your insurance to have a minimum of $25,000 per person for bodily injury, $50,000 per accident for bodily injury, and $25,000 for property damage. 

Luckily, there are many insurance companies that offer different rates for liability coverage. They may even have some incentives just for choosing their service.

Even though there is quite a multitude of these companies, we recommend insurance companies such as Nationwide, USAA, Farmers, State Farm, and Allstate. There are more companies on the market, but we urge you to click on one of the suggested companies to view their website for more information.

UI/UIM Insurance

Purchasing uninsured/underinsured motorist coverage is a good idea. This additional coverage kicks in to pay for medical expenses and other accident-related costs for you, members of your household or passengers in your vehicle if you are involved in an accident with an uninsured or underinsured driver.

Underinsured motorist coverage is an inexpensive addition to a normal auto insurance policy. If an at-fault driver that causes an accident does not have enough insurance to cover all damages, having an underinsured motorist coverage can protect you.

However, being in a car wreck caused by a without liability insurance can lead to you paying out-of-pocket for any expenses. Uninsured motorist coverage on your regular auto insurance policy can help protect you, so that you don’t have to pay for damages caused by another driver’s negligence.

Drivers who do not carry liability auto insurance, have a sufficient amount of coverage for medical bills, or whose insurance company denies coverage or goes out of business are all great examples of why you should have one, if not both of theses coverages. These types of coverage can help you recover expenses, such as medical bills, lost wages, funeral expenses, and damage to vehicles.

Unfortunately, uninsured motorist coverage is a requirement for drivers looking to purchase liability auto insurance in some states. If you happen to live in a state where uninsured motorist is optional, we genuinely urge you to consider the worth of this type of coverage. 

Certain states, it is a requirement for your insurance company to offer you uninsured motorist, whether you accept or deny that option is your choice. However, some companies may require that you reject this offer of coverage in writing if you choose not to purchase the additional coverage.

Our experienced Attorneys can advise you on the types and amounts of insurance that will best meet your needs and protect your interests and assets. We also provide counsel on the amounts of liability insurance you should have for your home, investment property, business, and medical, dental or legal malpractice practice.

Different Types of Liability Insurance

As stated before, there are several different forms of liability insurance. Although, most individuals think of automobile insurance when referring to liability coverage.

Among the different types of liability insurance, there is employer’s liability and worker’s compensation, product liability, indemnity insurance, director and officer liability coverage, umbrella liability, commercial liability, and comprehensive general liability. This section will attempt to explain more about other types of liability insurance like Employer’s liability and workers’ compensation, for example.

Liabilities of many forms can subject a business owner’s assets to substantial claims. Furthermore, having an asset protection plan that is built around available liability insurance coverage should be a top priority for all business owners.

For protection against liabilities resulting from injuries or death of an employee, employer’s liability and workers’ compensation is mandatory coverage for employers. However, employer’s liability and workers’ compensation are not the only two types of coverage for businesses.

Business that manufacture products for sale on general markets can deal with lawsuits resulting from a defective product. If a business has product liability insurance, they can protect the company against lawsuits resulting from injury or death caused by their products.

Coverage provided by indemnity insurance can protect a business from negligence claim on account of financial harm resulting from errors or failure to perform. If a company is to be sued, director and officer liability coverage can protect a company’s board of directors.

Additionally, another form of liability insurance, known as umbrella liability, is a policy for personal liability that protects against devastating losses. For example, when another insurance policy reaches its limit, umbrella liability coverage picks up the slack.

This type of policy is supplemental liability or additional liability insurance that covers beyond the dollar limitations of an individual’s existing auto, watercraft, or homeowner insurance. In addition, umbrella policies typically offer increments of $500,000 or $1 million at surprisingly affordable rates.

Insurance coverage for lawsuits resulting from injury to employees and the public, injuries resulting from other employees’ negligence, and property damage caused by an employee is called commercial liability. This type of insurance coverage is a standard commercial general liability or comprehensive general liability.

However, commercial general liability may also cover infringement on intellectual property, slander, libel, contractual liability, tenant liability, and employment practices liability. Liability insurance policies that are designed for any particular type of business are comprehensive general liability.

This policy covers any small or large business, corporations, associations, organizations, newly obtained businesses, and partnership businesses. Comprehensive general liability covers areas such as bodily injury, property damage, personal and advertising injury, premises and operations liability, and payments.

Unfortunately, insurers will not cover punitive damages, but offer coverage for compensatory and general damages for lawsuits. Now you may be wondering how personal liability and business liability differ.

Personal Liability insurance and Business liability insurance: What is the difference?

In short, personal liability can protect individuals from claims arising from injury or damage to other people or their property. This also includes if the insured causes the injury or damage to theirself or their own property as a result of their actions.

Business Liability insurance protects financial assets and interests of business owners and companies against damages or lawsuits arising from accidents similar to that of personal liability. However, this coverage also extends to product defects, recalls, and more.

Contact us

Whether you are seeking advice about liability insurance or you’ve been injured in an accident, our experienced legal team at Pepper & Odom, P.C., can help. Contact us online to schedule a free consultation, or call 601-202-1111 in Mississippi. In Alabama, call 888-498-4516.