Liability

What Does Liability Mean?

Liability refers to a responsibility or obligation that one party has toward another. In the context of insurance, parties can be held “liable” for various issues, such as injuries to others, malpractice, negligence, and more. Liability insurance is designed to protect individuals or companies from losses associated with these liabilities, particularly those resulting from lawsuits.

Insuranceopedia Explains Liability

Many companies face a high risk of liability for injuries, particularly because they often operate buildings or premises where numerous customers come to shop. If customers are injured while on company property, the company can be held responsible. For instance, if an employee forgets to dry an area of a floor after mopping and a customer slips and breaks a leg as a result, the company could be held liable for the injury. This is the type of claim a general liability policy is built to handle. Liability insurance can provide protection against such potential losses.

On the personal side, auto liability coverage is required in nearly every state. Figuring out how much liability insurance you need matters because state minimums are often too low to cover a serious accident. Drivers looking to meet the legal requirement without paying for collision or comprehensive can compare cheap liability-only car insurance options.