If you own a home in California, you already have personal liability insurance as part of your homeowner's insurance policy. Your automobile policy will include a liability clause if you drive on state roads. Liability is the portion that pertains to any lawsuits or judgments that can arise should someone visiting your home be injured on your property. It can also cover you for incidents that take place on someone else's property. Your auto policy's liability clause is meant to protect you should you or anyone who has permission to drive your car be involved in an accident resulting in personal injury.
The question is, "do you have enough?" As you well know, this is a time when people do not hesitate to file a lawsuit. If you are responsible for a personal injury, the plaintiff can seek compensation for a wide range of consequences they claim are a consequence of the incident. Some, like medical expenses and lost income, are concrete and easy to quantify. Others, like depression, disability, physical suffering, and PTSD-like effects, are a bit fuzzy and can be challenging to pin down.
If the total damages they ask for exceed your policy limits, you could be facing financial depletion. Not only could you lose your home but also all the assets you have accumulated over the years, including bank and checking accounts, investments, rental real estate holdings, and even college funds you've been putting aside for your children or grandchildren. If the plaintiff goes after them, your future earnings could also be at stake.
If what you've read here needs more clarification, we are happy to speak with you further. We want to point out that incidents happen. You need to review your liability coverage from time to time, especially as California property values continue to soar. Give Reza Shah Financial & Insurance Services a call, and we'll be happy to review your coverage.