What is Negligence?
Negligence refers to the failure to act with the level of care that a reasonable person would under similar circumstances. In the context of personal and business insurance, negligence often results in accidents or damages that could have been avoided. For instance, a homeowner who neglects to fix a broken handrail could be held liable if a guest is injured as a result.
Negligence can increase the likelihood of claims in property insurance. For example, suppose a property owner ignores maintenance issues, such as a leaking roof. In that case, the resulting damage may not be covered by insurance due to the owner’s failure to prevent the damage.
Negligence is categorized into two types: ordinary negligence and gross negligence. Ordinary negligence refers to a minor oversight or failure, while gross negligence is a severe disregard for the safety of others. In the insurance industry, negligence plays a significant role in determining liability and whether coverage applies in a claim scenario.
Many insurance policies include clauses that limit coverage in cases of gross negligence, where the policyholder’s actions were particularly reckless or careless. Understanding negligence is essential for both personal and business insurance, as it can affect the outcome of claims and potential liability.