Personal liability insurance covers legal and financial responsibilities if you accidentally cause bodily injury or property damage to others. It helps pay for medical expenses, legal fees, and settlements if you are sued for incidents like a guest slipping in your home, your dog biting someone, or accidentally damaging a neighbor’s property. This coverage is typically included in homeowners, renters, or umbrella insurance policies. It does not cover intentional harm, business-related liabilities, or injuries to you or your household members. Personal liability insurance also extends to incidents that happen away from your home, such as if you injure someone while riding a bike. Coverage limits vary, and higher limits can be obtained through umbrella policies for added protection. Without this coverage, you may have to pay out of pocket for legal defense and damages, which could result in severe financial hardship depending on the claim’s severity.