Personal liability coverage is one of the more comprehensive coverages on your home insurance policy and provides protection for any bodily injury or property damage to others for which you are held liable. Liability protection extends to you everywhere, not just within your home. However, it doesn’t provide coverage for injuries sustained by you, the insured, that would be covered by a health insurance policy. It also doesn’t cover liability due to an auto accident – that would be covered by auto insurance.
Dwelling coverage is the foundation of your homeowners insurance policy, as all other property values are calculated in proportion to that amount. The amount is determined on an individual basis by each insurance carrier for the replacement value of the building in question. The carrier underwriters determine this value based on a number of factors that reflect the total cost to rebuild the structure in case of a total loss.
No standard insurance policy, including the homeowners policy, covers catastrophic damage that can be caused by an earthquake. For an additional premium, companies offer an earthquake endorsement with your homeowners policy that will protect you in case your home suffers earthquake damage. In some areas, this coverage is typically inexpensive and should be considered. For instance, the New Madrid fault runs through the Midwest United States, an area not perceived as having earthquakes occurring frequently.