Civil liability insurance in the USA has multiple uses, from those that are contracted in-car policies, to those of large companies. ITS function is to provide economic protection to the insured if he accidentally causes material damage to the property of third parties or bodily injury.
Types of Liability Insurance in the USA
Civil liability insurance operates in almost all branches of damage insurance. The following are some of the most common:
- Car policies
- House insurance
- Business and corporate insurance policy
- Policy for professionals and medical hospitals
- Builders insurance
- Manufacturers of food and other products
What Does Liability Insurance Cover in the USA?
The most requested civil liability coverages are:
- Civil liability for damages to third parties. Protects against accidental damage to other people’s property. It is generally sold in auto, home, and business insurance.
- Civil liability for injuries. It protects from the expenses caused by the injuries caused to other people by accidents. It is sold in cars, houses, and business policies of all kinds.
- Professional civil liability policy. Covers for damages caused to others due to negligence, errors, or omissions in the practices of professional activity.
- Product liability insurance. It is a policy used by businesses and companies dedicated to the manufacture of products. Protects against damage caused by manufacturing defects.
- Family civil liability. It is a name given to family protection that is sold in home insurance. Covers damages to third parties caused by pets, by family members in case of accidents that do not involve the use of a motor vehicle. It also protects third parties from damages and injuries caused by housing conditions.
- General civil liability. Name given to company and business insurance, which includes the protection of material damage and bodily injury.
Civil liability coverage usually includes legal defense expenses for the insured and even payment of bonds and others that are necessary.
Is Liability Insurance Mandatory in the USA?
Auto liability insurance is mandatory in every state in the country. This allows damages caused in case of accidents to be compensated. Auto liability insurance can be purchased as basic coverage only.
The other insurances are optional, however, they are essential if you want to avoid a serious economic problem in the event of incurring in any of the covered risks.
How Does Liability Insurance Operate in the USA?
These insurances begin their operation at the moment in which the insured receives a claim for damages or injuries. As long as there is no demand, the insurance does not operate. At that time the insurer must be notified.
When there is a demand, the insurer sends licensees for the legal defense of the insured before the courts. If the lawsuits proceed and a ruling is issued in favor of the plaintiff, the insurer will pay the damages incurred with a limit of the amounts set by a judge, provided that it reaches the coverage contracted under the name of the sum insured.