Liability

Legal responsibility for injury, damage or loss suffered by another person or their property.

Plain-language definition. A real policy, endorsement and provincial law can use more specific wording than a glossary summary.

UpdatedAugust 31, 2026

ByCanada Rate Lab Editorial Team

SourcesIBC + primary sources

MethodologySource-led research

TERM SNAPSHOT

TermLiability

ContextCanadian insurance

Source typeIndustry glossary

Policy wordingControls claim

What does Liability mean?

Legal responsibility for injury, damage or loss suffered by another person or their property.

Liability coverage is different from coverage for your own property. Auto, tenant, home and business policies can each contain different forms of liability protection.

EXAMPLE

Liability in practice

A tenant may have personal liability coverage if they become legally responsible for certain damage to someone else's property, subject to the policy wording and limit.

Related Canada Rate Lab guides

C$1M vs C$2M Tenant Liability Commercial General Liability Tenant Insurance

Browse the glossary A–Z →

Professional Liability Insurance

Liability coverage designed for certain claims arising from professional services, advice, errors or omissions, subject to the policy wording.

Product Liability Insurance

Liability protection for covered bodily injury or property-damage claims arising from products, including exposures faced by manufacturers and distributors and certain completed-work claims.

Additional Insured

A person or organization added to another party's liability policy for specified protection arising from the named insured's operations, subject to the endorsement and policy wording.

Primary reference

Insurance Bureau of Canada — Insurance Glossary Canada Rate Lab — Sources & Data