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Frquently Asked Questions

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General Questions: Insurance


Liability – Am I liable?

Questions of liability follow every incident that hurts someone or damages their property. For a variety of reasons, the general understanding of what constitutes ”legal liability” is different from the reality. For example, would you be legally liable in the following examples:

It might surprise you to know that in each of these cases you are not presumed to be legally liable. Generally, in accidental tort cases, to be found legally liable you must have committed an act of “negligence”.

Negligence is the failure to exercise the degree of care considered reasonable under the circumstances, resulting in an unintended injury to another party.

There are three basic tests to determine negligence. 

  1. It must be shown that you owe a civil duty.
  2. You breached that duty.
  3. That your breach was the proximate cause (through an unbroken chain of events) leading to the injury. 

All three need to be present for a finding of common negligence.

In the business example above, as a business owner you owe a duty to your customers (invitees) to provide a reasonably safe shopping environment free of hazards that might cause injury. If a customer trips over an extension cord you put across an aisle, falls and is injured you would likely be held liable due to negligence. But, if a person loses their balance and falls without encountering a hazard then there was no breach in your duty and no negligence has occurred.

So, accidents happen but not all accidents are caused by negligence. You are not liable just because someone asserts you are. Technically, you are not legally liable for damages unless declared so by a jury or judge. When lawsuits are filed and taken to a jury the litigation costs can be very high and judgments are unpredictable. That’s why the vast majority of tort cases alleging negligence are negotiated and settled before trial.

Need liability insurance? 

AMERICAN INSURANCE has liability coverage available for every kind of personal and business need. Contact us for the advice of our professional agents and free coverage quotations.

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