Which statement about liability insurance is correct?

• A. Your own vehicle
• B. Other people or their property when you are at fault
• C. Your medical expenses
• D. Your passengers' medical expenses

Answer: (B)

Liability coverage is the part of an auto policy that protects others when you’re at fault. It pays for injuries to other people and for damage to their property, up to your policy limits. That’s why the statement describing liability as covering other people or their property when you are at fault is the correct one. It does not cover your own vehicle or your own medical expenses—those are handled by collision or comprehensive coverage for your car and by MedPay or PIP for your injuries. Passengers’ medical costs, if you have MedPay or PIP, would be paid by that coverage rather than liability.