Liability insurance is a type of insurance policy that protects people from losing money when they are accused of causing harm to others.
The most well-known example is automobile liability insurance, which will pay for damages up to a certain amount when a car accident is the policyholder's fault. If you don't have car liability insurance and you are responsible for a car accident, you would need to pay for the damages out of pocket, which can be financially devastating. Liability insurance protects you from this sudden financial loss.But liability insurance applies to more than just vehicles. Anyone who is at risk of being sued needs to carry liability insurance on their assets. And in today's legal climate, almost everyone is at risk of being sued! If you drive a car, own a home, rent an apartment, own a business or office, have a boat, or practice in a profession that directly affects people like medicine or dentistry-then you are at risk of being sued. Anyone who owns a restaurant, sports venue, or public meeting place should also carry liability insurance.
There are three main classes of liability insurance: 1) Public, 2) Product, and 3) Employer. Public liability insurance is needed in any industry that has the potential to affect third parties. Product liability insurance is needed by any company involved in manufacturing or supplying goods. And employer liability insurance protects both employers and employees in the event that someone gets injured on the job.
