Which of the following best defines liability insurance?

Liability insurance is specifically designed to provide protection against claims or lawsuits that arise due to bodily injuries or property damage inflicted on others. This type of insurance covers legal expenses, medical costs, and compensation for damages awarded to the injured party, ensuring that the insured party is financially protected in the event of such claims.

The primary purpose of liability insurance is to safeguard individuals or businesses from the financial burden that can arise from being held legally responsible for injuries or damages caused to others. This essential coverage is commonly utilized by various professions and businesses, as it helps cover the costs associated with defending against lawsuits and the potential settlements or judgments that might follow.

In contrast, the other options represent different types of insurance coverage. For instance, some coverages focus on one's own property or income loss, which does not fall under the realm of liability insurance. Thus, identifying option B as the correct definition provides a clear understanding of what liability insurance encompasses.