Which of the following best describes "liability coverage"?

Liability coverage is specifically designed to protect an insured individual or entity from the financial repercussions of claims made by other parties for injuries or damages for which the insured is legally responsible. This type of coverage addresses situations where the insured may be found at fault for causing harm to another person or damaging their property.

For example, if someone is injured on your property or due to your actions, liability coverage would help cover the legal costs and any settlements or judgments that arise from such incidents. This is crucial in ensuring that individuals do not bear the full financial burden of legal claims against them, which can be substantial.

The other options pertain to different types of insurance coverage. Damage to one's own property relates to homeowners or auto insurance, theft protection covers the loss of personal belongings, and medical payments coverage typically addresses immediate medical costs for injuries, regardless of fault. These definitions illustrate that liability coverage serves a distinct purpose focused on third-party claims rather than personal loss or immediate medical expenses.