# Is Liability Insurance Worth It?



## elykser (Mar 2, 2012)

Greetings! Thanks for taking the time to read my first ever question on this forum.
It’s a real estate related question but has to do with property insurance.
I own a $70,000 rural property (like, way out there but with paved road access) with a couple of small buildings (a shed and an old cabin). We don’t live on the property. The property insurance will be around $2,500 a year because, the insurance broker says, there is a high risk of forest fire and there is no fire department in the area. She also mentioned that if someone were to wander onto the property and get injured, I could be sued for a ton of money.
The fire risk is high, that much is true, but I have a problem with the whole liability thing. Anyway, that’s $200/mo I can’t afford and I wonder if it’s even worth it.
So, wouldn’t posting a “No Trespassing”, “Private Property” or even an “Enter at Your Own Risk” sign cover the liability issue? Also, the insurance company surely knows the odds of someone getting injured on my property but how likely is it that I’ll be sued? Any thoughts?


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## michaelman501 (Mar 1, 2012)

Would you drive your car down the road without insurance, or not insure your home ? I know those are completely different scenarios, but insurance is to protect you for when the unthinkable happens. From the sounds of it, the chance of someone getting injured on your property is slim to none, BUT weirder things have happened and thats what insurance is for. $200 a month sounds really expensive, i would shop around and get more quotes(if you havent done so already) Just my 2 cents!


Michael


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## Cal (Jun 17, 2009)

Perhaps you could call a local lawyer and ask how often that happens.

Keep in mind that insurance agents often try to play on your emotions (fear) to sell you more insurance that obviously benefits their salary, whether you really need the insurance or not.


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## Berubeland (Sep 6, 2009)

It depends on if you have assets. If you don't own anything and have no ability to pay no lawyer worth his or her salt will sue you. 

Once you have assets you become an attractive target.


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## OhGreatGuru (May 24, 2009)

Given your description of the property, I would be be more concerned about getting liability insurance than property insurance. If someone injures themselves on your property, you can be sued even if they were trespassing; Also, if a fire starts on your property and spreads to adjacent properties, you may be sued for damages by adjacent property owners. You could try to find someone who will sell you just liability coverage; or alternatively a comprehensive policy with a very high deductible for property loss to get a lower rate.

The buildings may not have much value to you, but you also have to consider what possible cleanup costs you may have if a forest fire goes through the property. Demolition and waste disposal don't come free.


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## elykser (Mar 2, 2012)

For me what it boils down to is: what is the least expensive insurance I can get for the most common accidents/incidents. Looks like I have some shopping around to do! Thank you all for your input!


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## iherald (Apr 18, 2009)

Are you able to get insurance that does not include fire insurance? Liability insurance is only to third parties (someone falls), you should get at least $1,000,000 if not 2 or 3. 

I know of a guy who had people who rode ATVs on his property and crashed. He didn't let them on the property, and had no knowledge of it, but is being sued for millions. fyi.

At $70,000 I might not pay for fire or flood insurance, but that's a decision you'll have to face.


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## donaldmc (Feb 27, 2012)

I think, all insurance are liability which is still an asset. We all need it in everything we had, particularly those things we consider as asset. I think in your case you should really consider to think it twice.


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## the-royal-mail (Dec 11, 2009)

I think this is a personal decision. Ignore the salesman. Look inside yourself and ask yourself if you could handle bad things A, B and C happening to your property and if you would want insurance in case any or all of those things happened. You can then decide for yourself.

In my own case, I carry liability insurance for my apartment, previously for my condo and of course for my car. And I would probably buy it if I had a second rural property. I think the risks are pretty high.


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## Charlie (May 20, 2011)

$2500 property insurance plus $2400 liability insurance seems awfully high. I'd talk to another agent and see if there are riders you can get on your existing home insurance or other less costly options. Consider what you really need to insure (ie if you're paying $2K to rebuild an abandoned run down barn, it may not be worth it -- but protecting yourself from liability exposure if a kid got hurt on your land is probably prudent). It may be best to deal with an independent agent who is aware of products from different companies.


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## elykser (Mar 2, 2012)

The price quoted ($2500) was for the whole sha-bang including liability, fire etc. It wasn't actually a quote; just an estimate off the top of her head. I will ask around for quotes on just liability insurance because, the value of the buildings (about $5000) don't justify the cost of any extra coverage.


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## elykser (Mar 2, 2012)

More info and an update: we already have condo insurance with The Co-operators on our primary residence in the city. A concerned family member advised us to get insurance on our rural property and said that we should be able to increase the liability component on our existing policy to cover our rural property. My first attempt was at The Co-operators where they said it might cost around $2500/y to insure the rural property but only by buying a second, separate policy. We dropped in a second time yesterday for a separate matter and asked again. They said that they couldn't increase the liability component of the existing policy to cover the rural property and that they didn't think any other insurance company could/would do that. Worried that we may have no choice but to buy the policy, we thanked them and walked across the street to the mom and pop insurance company and guess what? Their condo insurance is cheaper and they will cover the rural property for an extra $20 (twenty!) per year. Yes, $20.00!


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## Jungle (Feb 17, 2010)

Yes so what you just learned with insurance is:

1. To shop around and
2. If they they are not really interested in your risk, they will quote a high price.


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## Berubeland (Sep 6, 2009)

A good news story! Not sure about you but I feel great when I get a win like this one!


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