While no one would suggest that your home insurance policy should influence who you should be friends with, it’s not a bad idea to consider the ramifications of certain relationships. As you know, your home insurance policy isn’t just for property damage to your home – it also covers your personal liability. This means your policy will be called upon to protect you in the event someone is injured in your home. The policy also covers you for the actions of others in your household for whom you may be found to be liable and/or responsible.
One of the most common ways homeowners are exposed to personal liability claims is when guests are injured on their property. If you are throwing a party, you should definitely consider if anything in your house might be considered a hazard to your guests. Do you have a tricky set of stairs or steps in your backyard? Is it dark and poorly lit at night? Will you be serving alcohol to your guests? If you answered yes to any of these questions, you have quite the recipe for a personal liability claim! Before inviting others into your home, make sure you have taken the necessary precautions to prevent injury to them. It’s your obligation to protect your guests.
Of course, if you’ve protected your guests from injury in your home, you might still have to think about what happens when they leave. If you have provided alcohol to your guests, you may be exposing yourself to host liquor liability. If one of your guests were to drive away from your home and cause an injury on the road, you might be found liable for their actions. After all, you provided the alcohol and you then allowed them to drive away, knowing they may be impaired. There are ways you can minimize your risk by either carefully monitoring your guests’ consumption or hiring a professional bartending service. Professionals will bring their own insurance and will also be trained in knowing when to stop serving.
Another problem with guests is that their actions can have serious consequences and you can be found liable. Many years ago, I encountered a claim when working for an insurance company. A renter in an apartment had a friend staying with him who then caused a fire in the apartment unit. It resulted in a great deal of property damage and, luckily, no injury to others. However, because the guest was invited by the tenant to stay with him, the tenant was found to be partially responsible for his actions. Thankfully, this tenant had renters insurance, which then paid for the damage to the apartment building. Most home insurance policies (including renter’s policies) deem that members of your household are also insureds under the policy. While it’s great to have insurance, it’s probably even better to not have members of your household cause fires!
As you can see, you need to always be on the alert for potential areas of liability and risk. Unfortunately, even your best buddies coming to visit you might result in some unpleasant and awkward situations. Make sure you have the right insurance in place and choose your friends wisely!