In the context of liability insurance, what types of situations does it typically cover?

Liability insurance is specifically designed to protect the insured from claims made by third parties who allege that they have suffered injuries or damages as a result of the insured’s actions or negligence. This type of coverage is essential because it helps cover legal fees and any settlements or judgments that may arise from these claims, thereby safeguarding the insured’s financial stability.

When considering the other options, intentional acts leading to harm typically fall outside liability coverage because insurance is not designed to cover actions that are deliberate and wrongful. On-the-job accidents for employees are generally addressed by workers’ compensation insurance, which provides specific coverage and benefits for employees injured in the course of their employment. Lastly, loss of revenue for the insured business is not a primary focus of liability insurance; instead, this situation is usually covered by business interruption insurance. Thus, claims resulting from injuries and damage to others accurately represent the core purpose of liability insurance.