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The Difference Between Personal Liability and Personal Property Claims?

In a standard homeowners insurance policy, you have coverage for both Personal Liability and Personal Property.

Personal Liability Coverage

Coverage E - Liability - Personal Liability coverage pays for loss settlement and legal fees if you or your family members cause bodily injury or property damage to others. I know everyone can be clumsy at times. For example, a neighbor slips on your porch and breaks elbow. He is a grumpy neighbor and sues you for the damages. The lawsuit is when your liability coverage steps in to defend you in a lawsuit.

Where it won't step in is if you intentionally damage something or someone. If you start a bar fight and punch someone, your liability claim will be denied

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Personal Property Coverage

Coverage C - Personal Property - covers damages and theft of your personal property. Personal property includes items like clothing, appliances, furniture, and stuffed animals laying around the house. When this stuff gets damaged or stolen by something covered in your policy, it comes out of Coverage C. It is important to note, there are usually special sub-limits for certain categories of items:

  • $1,500 - Jewelry
  • $1,500 - Computers
  • $1,500 - Photo and Video Equipment
  • $1,500 - Bikes
  • $2,500 - Musical Instruments 
  • $2,500 - Golf Equipment
  • $2,500 - Fine Arts
  • $2,500 - Firearms
  • $2,000 - Coin Collection
  • $1,500 - Furs
  • $2,500 - Silverware (grandma?)
  • $1,500 - Stamps
  • $1,500 - Postage

If you have special high-value items, such as that beautiful engagement ring, consider scheduling the item separately, so you know that it is fully covered.

Pro-Tip

Always ask for Personal Property Replacement Cost in your policy. Replacement cost ensures that if your stuff gets damaged or stolen, it is replaced by the insurer in brand spanking new condition, not the old, used value (also called depreciated value). You don't want your belongings replaced at a depreciated value, that is liking buying them used off craigslist.

At your service,
Young Alfred