How much liability coverage do you have? Do you know how much liability you should have? More often then not people step into my office unaware of how much coverage they have and think they are saving money by having only what the state requires.

Let’s back up a bit and go over what exactly liability is. I like to keep it simple and say that liability is what will cover you’re A$$-ets but let me dive in a little deeper.

On an auto policy liability will pay out damages done to the third party. It will pay to fix the vehicle as well as medical bills if they where injured. Liability will also protect YOU if they end up suing. On a home policy the liability is very similar. It will cover you if someone is injured on your property or by your pet, property damage caused by you, your family, or your pet.

That brings us back to the question, how much liability do we need? That all depends on how much assets you have. Do you own your home? Have rental properties, stocks, bonds? Or how about a job? Even if you don’t have a long list of assets if you earn an income you are at risk. Depending on what the laws are in your state, 25% of your income could be garnished if you are sued or if you are underinsured.

Let’s do some quick math:

• You run into a 2018 GMC and total it – $40k
• Two passengers must go to the hospital – $60k
• You owe a total of $100k
• Your auto will pay out your max limit of $50k

Now you are responsible to come up with the remaining $50k, if you don’t have that laying around then all your assets are at risk.

There are many different options when it comes to liability coverage and this is when talking to your agent can be beneficial so you can make sure that all, you’re a$$-sets are protected!