What does Coverage E cover in a homeowners policy?

Coverage E in a homeowners policy specifically addresses personal liability coverage. This type of coverage protects the policyholder when they are legally responsible for causing bodily injury or property damage to others. This means that if someone were to get injured on the policyholder's property or if the policyholder accidentally damages someone else's belongings, Coverage E would assist in covering the claims up to the policy limit.

This coverage is vital because it not only protects the financial interests of the homeowner in the event of lawsuits but also covers legal costs associated with defending against these claims. The inclusion of both bodily injury and property damage within this coverage highlights its comprehensive nature, ensuring that homeowners can have peace of mind knowing they are protected against a wide range of liabilities.

The other options do not accurately represent the purpose of Coverage E: it is not limited to property damage claims alone, nor does it pertain primarily to medical expenses for injuries sustained on the property, which would typically fall under a different type of coverage. This clarity helps in understanding the importance and scope of Coverage E in the homeowners insurance landscape.