What does liability insurance cover?

Liability insurance is designed specifically to protect the insured from claims arising from injuries or damages that they may cause to another party. This type of coverage ensures that if the insured is found legally responsible for causing bodily injury or property damage to someone else, the insurance will cover the costs associated with those claims, including legal defense costs and any settlements or judgments resulting from lawsuits.

For example, if an individual accidentally causes a car accident that injures another person or damages their vehicle, liability insurance would pay for the medical expenses of the injured party and cover the cost of repairing or replacing the damaged vehicle. This crucial aspect of liability insurance provides peace of mind, as it helps cover unexpected legal costs and financial burdens stemming from such incidents.

The other options do not accurately reflect the purpose of liability insurance. Injuries to the insured are typically covered under health or personal injury insurance, while damage from natural disasters is more aligned with property insurance or specific disaster coverage. Lastly, liability insurance specifically encompasses more than just property damage; it also includes bodily injuries, distinguishing it from options that limit coverage to only one type of damage.