Does Insurance Cover Civil Lawsuit?

If you find yourself being sued in a civil claim, you might be wondering, “Does insurance cover civil lawsuits?” If someone sues you and you are ordered to pay them, this could set you back financially — and significantly so. It’s possible that you may not even have the amount of money that you are supposed to pay out. In some circumstances, you may have insurance that can help you with the monetary consequences of a civil claim. If you find yourself in this position, you should contact a lawyer right away for assistance. The attorneys at Morgan & Morgan can help you with this. We will review your insurance policies and determine if they provide you with any coverage for a civil claim. Additionally, if you decide to file a civil lawsuit against someone else, we will review your policies to see if attorney fees are covered. Contact Morgan & Morgan today to set up a free consultation.

What Is a Civil Lawsuit?

A civil lawsuit is a non-criminal lawsuit that is set in motion by a person or business allegedly suffering some kind of harm or damage. This civil case occurs when the plaintiff, the party filing the complaint, claims to have been harmed by the defendant, the party defending the complaint and asking the court for relief. The plaintiff may plead for relief in monetary damages or by court order, such as an injunction or a declaration of legal right. 

A civil lawsuit can be expensive, even if you’re the one filing it, so having adequate personal liability coverage as part of your insurance policy is one way to help protect yourself financially.

Some Insurance Policies Cover Civil Claims 

In many cases, the personal liability portion of your insurance policy can help provide financial support for your legal defense in a civil claim, regardless of the outcome of the suit. This includes homeowners’ insurance, auto insurance, condo insurance, and more. 

This insurance liability coverage may also help pay the other party’s medical fees and damages should you find yourself required to pay someone who filed a suit against you.

Homeowners Insurance 

Personal liability coverage is a standard component of most homeowners’ insurance policies. It typically provides you with financial protection against lawsuits filed by others, including legal fees and injury that you may have unintentionally caused another party.
 
Homeowners’ liability coverage typically extends to those living at your house as well. This includes your children and pets. For instance, if your dog bites someone while they are visiting your property, your insurance company might cover the medical expenses for the other party. Similarly, if your child accidentally breaks a neighbor’s window, this could be covered under the property damage portion of your policy.
 
While your insurance policy can provide many benefits, there are some situations where your liability coverage would not apply, such as property damage or injury that result from acts of war or intentional damages. Additionally, your homeowners’ liability coverage does not cover business-related activities. If you run a business out of your home and someone visiting you for business purposes is injured on your property, that would be covered by business insurance.

Auto Insurance 

Most standard auto insurance policies include personal liability coverage. Liability car insurance is part of an auto insurance policy that provides financial protection for a driver who harms someone else or their property while operating a vehicle. Many auto insurance policies can also help cover legal expenses if someone files a lawsuit against you.

This type of policy does not cover damages you or your property may have sustained during a car accident. However, this may be separately covered by other parts of your policy. 
The liability portion of car insurance can include several components, including bodily injury liability and property damage liability. 

• Bodily injury (BI) liability coverage: Bodily injury liability helps cover medical expenses for those involved in the accident, excluding you. This coverage handles medical expenses and lost wages for people in another vehicle if you are at fault for the crash.
• Property damage liability coverage: Property damage liability coverage helps cover the costs of repairing the vehicles of other drivers involved in the accident.

It is possible in many states to purchase auto insurance that has more coverage and will help compensate you for your own property damage and physical injuries should you be involved in an accident. Many people opt-out of this, assuming they won’t ever need it. Having this coverage, in addition to the coverage that the other driver has, could save you from having to file a civil lawsuit in many cases.