What does liability insurance primarily cover?

Liability insurance primarily covers property damage caused by the policyholder to others. This type of insurance is designed to protect the insured from claims resulting from injuries and damage to other people or their properties. When an incident occurs and the policyholder is found liable, liability insurance provides financial support for legal fees, settlements, or judgments that may arise from lawsuits or claims filed against the policyholder.

This coverage is essential for individuals and businesses alike, as it mitigates the financial risk associated with causing accidental harm or damage to others, ensuring that the policyholder can meet their legal obligations without facing severe financial consequences. In contrast, the other options relate to forms of coverage that would not fall under the umbrella of liability insurance, such as personal medical expenses or repair costs for the policyholder's own property.