WHAT IS PERSONAL LIABILITY INSURANCE COVERAGE AND WHY STUDENTS MUST HAVE IT?

When students go abroad for higher studies, they not only leave behind their country but also the laws governing citizens of that country. A student is expected to abide by the laws of the country where he or she is pursuing higher education, even if that student is not the citizen of that country. However, what makes things complicated is the fact that no two countries follow the same set of laws. Therefore, a seemingly harmless act in one country could invite legal action in another.

Many times, either knowingly or unknowingly, students commit such acts that lead to legal action either in criminal or civil court. Such students are often unable to arrange money for legal counsel as well as to meet bail condition.

In this blog, Student Cover provides you information about personal liability coverage under insurance plans and why it is essential for students who are traveling abroad to have insurance that covers personal liability.

What is Personal Liability Insurance?

Like any other insurance coverage, personal liability coverage assures financial support in an unforeseen event. It promises to meet any financial liability arising out of actions of the policy holder which leads to accidental injury or loss of property to the third person.

However, the assistance is only limited in case of unlawful act that leads to civil action and not those that lead to criminal prosecution. Such personal liability coverage have amounts earmarked to provide financial support and relief for different types of liabilities. Personal liability coverage can be provided under a stand-alone policy or may come packaged under a comprehensive insurance plan such as travel insurance.

Why students must have personal liability insurance?

Students should have personal liability insurance because it provides cover against the following types of financial liabilities:

1. Medical bills – If due to action of the policy holder the third person is injured which requires medical treatment, then the insurance covers the cost of such treatment incurred on that affected person. In the absence of such coverage, a student might have to pay from his or her own pocket, the medical bill of such person. In many cases, this coverage extends not only to injury caused by the policy holder but also any third party injury that occurs within the property of the policy holder.

2. Legal defence costs – In countries like the US, the cost of legal defence is as costly as medical treatment. In case of personal liability, a student, against whom a suit is filed, may have to meet the legal defence cost from his or her own pocket. However, if the student has personal liability coverage, then this cost including the lawyer’s fees is covered up to the amount specifically mentioned in the policy document.

3. Court-imposed settlement amount – In several personal liability insurance plans, the insurance provider pays the court-imposed settlement amount. One should be aware that in case of personal liability suit, the amount of damage claimed by the third party could run into millions of dollars. If a student has sufficient personal liability insurance, then the he or she will not have to pay the damage from own pocket. Instead, the insurance company, on behalf of the student pays the amount settled by the court as compensation.

4. Student’s professional liability – Certain professions such as medicine or nursing may witness instances where the medical advice or medication administered the medical practitioner may adversely affect the patient’s health. This may lead to the patient or his or her relatives filing a suit against the medical practitioner. If a medical student studying in the US has professional liability insurance, the financial aspect of the liability will be covered by the insurance company.

However, not all insurance plans cover liability arising out of professional action. Readers are advised to read the policy document to find out if the liability insurance taken by them covers those liabilities due to professional activity.

Let’s Wrap Up!

Personal liability insurance coverage aims to provide financial support to the policy holder in the event of any injury or damage caused to the third person due to actions of the policy holder. This coverage is a must of students who go abroad for higher studies as it helps meet the cost of medical expenses incurred to third party due to actions of policy holder. This also covers cost of legal defence as well as the amount that the policy holder may have to pay to the affected person as damages. Certain professions such as medicine and nursing require students to have professional liability insurance coverage in addition to personal liability insurance.

Disclaimer: The content of this blog is based on personal research of the writer. Readers discretion is advised. Neither Student Cover nor the writer will be held responsible for any wrongful interpretation of the content of this blog.