Damage of property or any asset can be dangerous as well as very, very expensive to repair. A property damage liability is a term that is used in connection with such assets that have been damaged and are covered by liability insurance.
What is a property? A property can be often defined as any inanimate or non living asset or object. There are many situations where assets can get damaged as a result of accidents, mishaps and also human neglect. The legal system of United States has made provisions with the help of which, people can also file suits against people, the actions of whom, have caused the damage. Many people often get confused as a result of the many winding terms and provisions, of damage liability insurance policies, and property damage, the concept as a whole.
What is Property Damage Liability?
It so happens that, at times accidents are caused as a result of human negligence. Auto accidents due to drunk driving or improper services, are some cases where property damage is caused as a result of human negligence. The party responsible for the damage in such a case is termed as the ‘party at fault’, and in court of law, he is termed as ‘defendant’. The party who has suffered from damages and is injured is known as the ‘injured party’, and in the court of law, he is known as the ‘plaintiff’.
In the court proceedings, if the plaintiff is able to prove that the damages have been caused as a result of human negligence, then the defendant or the party at fault has to pay a particular amount (which has been prescribed by the court of law) to the injured party, as a compensation for the damages caused. This payment becomes a liability for the defendant and is hence, termed as a property damage liability.
It must be noted that personal injuries, loss of business or loss of reputation are some damages that are not included in the property damage calculations. Only the damage and loss of physical and material property is taken into consideration during the proceedings of such a case.
Liability Coverage
An increasing trend in the property damage case laws, has led to the origin of insurance policies and coverage that help the insured persons and policy holders to pay compensation to the injured party. Any person, right from an individual or a huge corporation can avail such an insurance policy. Such policies are tailored to the needs to the policy holders, and usually have a simple mechanism.
If a person avails a property damage auto insurance, there are some select factors that become insured or covered in accordance with the policy. For example, the liability coverage that is provided for auto owners, includes all property damage liabilities arising as a result of auto accidents, like damage to other cars, damage to public amenities, etc.
The premium of such liability coverage, depends upon some essential factors that are audited by insurance company agents before the policy is approved. We can again take the example of a liability coverage that is provided for cars. In such a scenario, the insurance agents consider factors such as age of the driver, horse power of the car, driving habits, driving violation record of the driver, etc. In short if you own a sports car or a muscle car that has an exceptional horse power and speed, then you will need to pay a larger premium.
Sometimes the object of insurance also matters a lot when it comes to the calculation of the premium. For example, if you are insuring a bulldozer with the property damage, then the premium is bound to be high due to the simple fact that a bulldozer is bound to cause a lot of property damage in case of an accident.
As a common citizen, I would recommend that you get coverage of such a general liability property damage policy for your car or your boat as the liability in case of damage can be enormous and is bound to put any person in a financial difficulty. Another factor that I would like to point out is that though the policy premium sounds enormous, if clubbed with a normal policy, such as a car insurance policy, it does not seem too much.
