What does property damage liability insurance cover?

Property damage liability insurance is designed specifically to provide coverage for damage that the insured causes to someone else’s property as a result of an accident for which they are found to be legally responsible. This type of insurance is crucial in protecting the insured from financial loss due to the need to compensate others for damage they have caused.

Option A accurately describes the purpose of property damage liability insurance because it focuses on the coverage that protects the insured from costs arising from damage inflicted on another person’s property, which can include vehicles, homes, or other structures.

While other choices may reference aspects of insurance coverage, they do not correctly define the specific scope of property damage liability insurance. For instance, limiting coverage to only vehicles does not encompass all possible property damage scenarios, and medical expenses pertain to bodily injury liability rather than property damage. Lastly, suggesting coverage for both bodily injury and property damage would refer to a broader insurance policy, such as general liability or personal auto policies, rather than solely focusing on property damage liability insurance.