What is Third-Party Liability Coverage?
Third-party liability coverage is a type of insurance that protects the policyholder from being sued by a third-party for damage incurred by their pet. There are two primary types of liability coverage for pet-related incidents: the first is for claims that pertain to personal damages a third-party incurs for the cost of medical care after being attacked by a pet; the second is for property damage, which covers costs related to the destruction of one’s home, yard, furniture, or possessions. Both forms of liability coverage also include the cost of legal defense the policyholder may require if a third-party takes them to court on account of their pet.
How Third-Party Liability Coverage Works
All insurance plans vary by provider, but generally, a pet owner with liability coverage pays a monthly premium toward an annual deductible, so they can minimize the financial risk of an expensive lawsuit caused by their animal’s behavior. If they were to be sued by a third-party because their pet caused physical injury, hospital bills, ongoing medical treatment, psychiatric care, and emotional trauma, they could face thousands of dollars in fines. In addition to these financial damages, they may also be required to pay for the third-party’s legal representation on top of their own. For many pet owners, this could result in financial ruin, but liability coverage only requires policyholders to pay for a portion of damages, and the insurance provider covers the rest.
- Third-party liability coverage can protect you financially if your pet injures another person or damages someone else’s property.
- Insurance companies help by reimbursing the third-party for the costs of medical treatment or property repair.
- Third-party liability also provides coverage for legal defense in the event someone sues for pet-related damages or injuries.