How does liability insurance primarily differ from property insurance?

Liability insurance primarily differs from property insurance in that liability insurance is designed to cover legal responsibilities for damages caused to other parties due to negligence or unintentional harm. This includes situations where the insured may be held financially responsible for injuries or damages to someone else's property, such as in a car accident or a slip and fall incident. On the other hand, property insurance is focused on protecting the insured's own assets from risks such as theft, fire, or damage.

The distinction lies in the nature of what is covered: liability insurance addresses obligations to third parties and their claims against the insured, while property insurance provides coverage for owned assets. This clear delineation is crucial for understanding how these types of insurance operate and the scope of protection they offer to the insured.