But a little cost benefit analysis can help you make a rational choice as to what types of coverage you need and what the amounts of those coverages should be.
Liability coverage is both the easiest and hardest coverage to gage.
Because what it might have to cover is always unknown. Good liability coverage will pay for whatever injury to other persons and damage to the property of others a court may find you responsible to pay for, AND a good liability policy should also provide for the payment of your legal costs in defending against a claim. The latter can be a significant amount if you become involved in a personal injury or significant property damage claim, even if you are ultimately found not to be liable for damages, and is an important part of any liability coverage policy. Liability coverage is often attached to property insurance for assets used in the underlying activity. For instance, your auto policy should provide liability coverage for damage and injury that happens while you are driving your vehicles, and your home owner's or renters policy should provide liability coverage for injuries incurred by others on your residential property.