General
Liability Coverage
Pays for injury or property damage you cause to other people, up to your policy limit.
What it actually means
Liability coverage protects your assets, not your own property — it pays out when you're legally responsible for someone else's injury or property damage. It exists on auto, home, and umbrella policies, and running out of liability limit means you're personally on the hook for the rest.
Example: If you're at fault in a car accident that causes $80,000 in injuries and your limit is $50,000, you could be personally liable for the remaining $30,000.
See it in context
Run the free Insurance Coverage Blueprint to see how liability coverage and terms like it apply to your specific situation — no signup required.
Related terms
Umbrella InsuranceBodily Injury LiabilityProperty Damage Liability