What is Personal Liability Cover in Travel Insurance?

What is Personal Liability?

You are personally liable if your negligence has caused a loss or damage to the property to another person. This can be completely unintentional but nevertheless, you will be held responsible for causing their loss.

Personal liability is thus the legal responsibility on your part towards the suffering party. This damage also includes any injury or harm caused to a third person.

For example:

While at an airport, your luggage accidentally slips and lands on an old woman’s foot. Sadly, she gets imbalanced and ends up getting a fractured arm. In this situation, she can easily sue you for unintentionally causing her bodily damage.

Usually, you end up paying a decided sum to compensate for their losses as per the court verdict or as decided by the authorities concerned.

Meaning of Personal Liability in Travel Insurance

Accidents happen all the time. Even on a vacation, the chances of unintentionally hurting someone or damaging a stranger's things aren't uncommon.

Sadly, this doesn't excuse our mistake and the loss it causes to the other person. It is only fair that we pay or compensate them for this loss. Many times during a trip you can unintentionally cause damage to a stranger’s property or body. This is usually a stranger who is not your family member or is travelling with you.

Since you're abroad, you will most likely end up solving this matter formally. This is where personal liability comes in handy. Single-trip travel insurance plans with personal liability coverage can save a lot of heartache and money in case you end up being legally liable to someone. Let us see how.

Continuing the example in the section above, we can have two scenarios after accidentally hurting the old woman at the airport:

• Now, if you didn’t buy single-trip insurance with personal liability coverage then you will end up compensating her (along with any legal fee) from your savings or worse, even taking a loan from someone.
• By any chance, if your travel insurance offers legal liability benefits then you’d be safe from this financial burden.

Since you're not familiar with the laws of a foreign country, it can be a confusing and rather expensive time for you. Legal manipulations can also cause extra expenses as you may not know the provisions. Your insurance carrier will guide you and help you defend your case to reach a settlement with the third party.

How Does Personal Liability Cover Work?

Claims under personal liability include any legal fees, medical bills and any other kind of compensation as deemed necessary for you to provide. This can range from a few thousand to lakhs of rupees.

While some insurers may provide this as an add-on, some plans offer this benefit as an optional. You will need to pay extra for it.

In case you ever become personally liable to another person while on a trip, you will end up paying out of your savings. It's going to be a worse setback for those on a budget. If you buy comprehensive travel insurance with personal liability coverage, then you can avoid this altogether.

Suppose you find yourself in a similar situation abroad, you can immediately inform your insurer about the situation. They will guide you through the process, point towards the relevant authorities and even explain how to arrange all the necessary paperwork.

Personal Liability Benefits: Things to Keep in Mind

Under personal or legal liability coverage, if you end up becoming liable to a third party, your insurer will cover those expenses up to the set sum insured or limit. However, there are some things to keep in mind:

• If you’re travelling with family or minor children, then any damage caused by them can also make you personally liable. To avoid this, make sure to get family travel insurance with personal liability benefits.
• If you are personally liable to another person due to intentional damage (acting out in anger, attacking someone, provoking someone etc.)
• If a third party files a claim against you, then you must confirm that you're innocent. Your insurer will only cover you if you've not caused any intentional damage.
• Many times, your travel insurance provider acts as your representative. They can also avoid formal proceedings by arriving at a mutual agreement.
• In case of out-of-court settlements, your travel insurance provider will settle it directly.
• In case you go with a legal route or feel that your insurer has not reached the desired settlement, you can continue with these legal proceedings. However, you may not get compensated for the entire amount and other additional expenses.
• Always remember that there are many exclusions under this benefit. You won't be able to get this benefit in case of any disease transmission, unlawful acts, or deliberate/unlawful acts.
• If you're travelling with animals or pets, then any damage caused by them won't be covered under personal liability insurance.

Wrapping it Up

Most people don’t consider legal or personal liability as something important during a trip abroad. However, one small mistake is enough to harm or damage a person’s body/assets. This benefit is especially important when going to a country with different laws. What’s more, if you’re going to a very expensive country, it will keep you safe from hefty legal expenses other than necessary medical and compensatory burdens.