Which of the following best describes liability coverage under a commercial policy?

Liability coverage under a commercial policy is designed to protect businesses from claims resulting from injuries or damages that they may cause to third parties. This broad protection includes coverage for both bodily injury and property damage, which means that if a business is found legally liable for causing harm to someone or damaging someone else's property, this coverage would apply.

Bodily injury coverage addresses costs related to physical injuries that could arise from the business's operations, such as medical expenses, lost wages, and legal fees if a lawsuit is involved. Property damage coverage covers the costs associated with damage to another person's or entity's property, which could result from various business activities, such as accidents that occur on-site or damage caused by business operations.

This comprehensive nature of liability coverage ensures that businesses are secure against unforeseen incidents that could lead to substantial financial losses. It indicates a fundamental aspect of risk management within a commercial insurance framework, underscoring the importance of safeguarding against liabilities that arise during typical business activities.

In contrast, other options provide a more limited view of insurance coverage that would not adequately address the broad spectrum of potential liabilities a commercial entity might face. For instance, focusing solely on personal property, employee injuries, or theft does not encompass the full range of risks that liability coverage is