What does Coverage E of a homeowners policy cover?

Coverage E of a homeowners policy provides personal liability protection. This coverage is essential because it offers financial protection to the policyholder if they are found legally liable for causing injury or property damage to another person. For example, if a guest is injured on the policyholder's property and decides to sue for damages, Coverage E helps cover the associated legal costs, settlements, and judgments.

The importance of this coverage lies in its ability to secure the policyholder's financial welfare in the event of an accident or incident that leads to a liability claim. This coverage typically also includes defense costs, even if the claim is disputed or groundless, reinforcing the protection it provides to homeowners against potential financial loss arising from legal actions.