A yard sale is a great way to clean out your home, make a little money and do some good for the environment by providing a second life for your possessions. But your enterprise could get expensive if someone gets hurt on your property and decides to sue, according to the Insurance Information Institute (I.I.I.).

"Somebody could slip and fall in your front yard and you could be legally liable," said Jeanne M. Salvatore, senior vice president and consumer spokesperson at the I.I.I. "Check with your agent or company representative to be sure you have enough liability insurance to protect your assets in case you’re sued."

Both homeowners and renters insurance provide liability protection which covers you against lawsuits for bodily injury or property damage that you or your family members cause to other people. This coverage pays for both the cost of defending you in court and court awards — up to the limit of your policy. Most standard home and renters insurance policies will generally provide at least $100,000 of liability coverage. Additional liability protection is available and everyone should consider getting enough insurance to protect their assets and finances.

Many people do not realize they have no-fault medical coverage as part of the liability protection in their standard homeowners or renters policy. This allows someone who gets injured on your property to simply submit his or her medical bills to your insurance company. Thus, medical bills can be paid without resorting to a lawsuit. Most policies include about $1,000 to $5,000 worth of this coverage. It does not, however, pay the medical bills for your own family or pet.

“We live in a very litigious society,” pointed out Salvatore. “Having an adequate amount of liability protection is a very important financial protection.”

In 2006, jury awards in personal injury lawsuits averaged $978,848, according to Jury Verdict Research.

Consumers wishing to obtain additional liability coverage can increase the amount of liability insurance on their home or apartment to $300,000 or $500,000. Those who need more liability protection can also consider purchasing an umbrella or excess liability policy. These policies cost about $200 to $350 for $1,000,000 of additional liability protection and there is a requirement that a certain amount of underlying coverage already be in place — generally about $300,000. Umbrella policies also provide broader coverage for claims involving libel and slander.

The I.I.I. offers the following guidelines for insuring a yard sale:

• One Time Event: Yard sales that are one-time events for the sole purpose of selling unwanted personal items are most likely to be covered under a standard homeowners policy. However, it is important to have enough coverage, so be sure to check with your insurance agent or company representative.
• Frequent Yard Sales: If you plan to have frequent yard sales, you probably need to purchase a separate policy for business liability or an in-home business policy. These policies are available from homeowners insurance companies and specialty insurers that sell stand-alone in-home business policies.
• Charity Fund Raiser: If you are staging a sale to raise money for a charity, you will most likely be covered under your homeowners or renters insurance policy. But you should also contact the charity to see what type of insurance protection they would be willing to extend to you if necessary.

In addition to checking your insurance coverage, plan your sale with safety in mind.

• Repair loose railings and cracked concrete which may cause injuries.
• Place sale items so that there is enough space to move about without tripping.
• Avoid placing items too close to stairs and ledges where people could fall.
• Keep sharp objects such as knives and scissors out of the reach of children.
• Do not sell items that you know are unsafe or hazardous, including recalled items.
• Keep your pets safely indoors during the sale. Some dog breeds can become very protective when several strangers are on their property.
• If someone does get injured, make sure that you get them medical attention as soon as possible.