Liability insurance is one of the most required insurance covers in the general insurance system. This type of cover offers protection against the financial risk of the "insured" against the risks of liabilities imposed by lawsuits or any other similar claims. It covers the insured if he or she is sued for the cases covered by the policy. Liability insurance offers case specific protection to the insured against third party claims. In case of a liability claim, the insurance company pays to the third party on behalf of the insured. The liability policy does not cover contractual or intentional liability. In case of a claim, the insurance company can defend the insured. The legal cost of defence is usually independent of the coverage limit.