What is Legal Liability?
Legal Liability The legally enforceable obligation of an insurer or insured to compensate a third party for loss or damage caused by acts, omissions, or negligence, as established by law, contract, or court judgment. Central to liability insurance products.
Source: CFA Institute, IFRS Foundation, FASB (GAAP), Basel III Framework
How is “Legal Liability” Used in Practice?
A general liability policy covers the insured's legal liability for bodily injury or property damage to third parties arising from covered incidents.
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Who Needs to Know This Term?
- Financial Analysts
- Bankers
- Traders
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What is Legal Liability?
The legally enforceable obligation of an insurer or insured to compensate a third party for loss or damage caused by acts, omissions, or negligence, as established by law, contract, or court judgment. Central to liability insurance products.
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