The town-home has a higher level of need for additional liability insurance.  The close proximity of the neighbors mandates that the insured positions him/herself to be a “good neighbor”.  Example: You the insured live in a town-home.  You accidentally burn your home down.  No problem, the insurance policy on the home is there to protect you… BUT… the fire damages the home next door too.  It was not your Neighbor’s fault that the fire occurred.  The result: the insurance company and the neighbor will sue YOU for your negligence.  The Liability coverage is there to provide coverage just for these types of issues.

Many policies have inherent liability coverage of $100,000.00.  That amount of coverage is in most cases way to small to cover the property, building, and other costs associated with a major claim.  Having $300,000 of liability coverage traditionally adds less than $20.00 more per YEAR to your policy and provides Great additional coverage.  $500,000.00 of liability coverage is traditionally $50.00 more than the inherent liability coverage price.  The coverage is low cost and helps you be a good neighbor by providing protection to others when you cause them loss.

There are other nuances to the liability coverage.  This is a good start.  Let’s discuss more later.

Matt Locke