Glossary

Property damage liability

Coverage that pays when you are legally responsible for physically damaging someone else's tangible belongings or building, or for taking away their use.

Also called: PD liability

This is the half of your personal liability coverage that responds when you or a family member damages something that belongs to someone else. Under the standard ISO homeowners form (HO 00 03), "property damage" means physical injury to, destruction of, or loss of use of tangible property. Loss of use matters. If your tree falls on a neighbor's garage and he rents parking elsewhere for three months, that cost can be part of the claim.

The insurer defends the suit and pays damages up to your Coverage E limit. Say a neighbor's $4,000 window is broken by a heavy limb you failed to trim (hypothetical) and he holds you responsible: the insurer handles the claim and pays what you legally owe.

Know the limits. The policy does not cover damage to your own property, which falls under dwelling coverage or personal property, or to property rented to, occupied by or in the care of an insured, except for fire, smoke and explosion. Intentional damage and damage arising from a business are excluded. A small extra, Damage To Property Of Others, pays up to $1,000 per occurrence at replacement cost whether or not you are legally liable, which helps settle minor mishaps without a dispute.

Last reviewed October 10, 2026

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Related terms

Personal liability (Coverage E) Coverage that defends you and pays damages if you are legally responsible for injuring someone or damaging their property, at home or away from it. Bodily injury Physical harm to a person, including sickness, disease and resulting death, that triggers liability and medical payments coverage under a homeowners policy. Medical payments to others (Coverage F) No-fault coverage that pays the medical bills of a guest hurt on your property, whether or not you were at fault, up to a small per-person limit. Premises liability The legal duty of an owner or occupier to keep property reasonably safe, and the exposure when a visitor is hurt by a wet step, loose railing or icy walk. Personal injury Liability coverage for non-physical wrongs such as defamation, false arrest, invasion of privacy and wrongful eviction, usually added by endorsement. Exclusion A policy provision that removes coverage for a stated cause, type of loss, property or circumstance that the coverage would otherwise reach.

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How much liability and umbrella coverage do I need? Size your homeowners liability limit and an umbrella policy to the assets and income a lawsuit could reach, and to exposures like a pool, dog or teen driver.