What does the liability coverage (Coverage E) in a homeowners policy generally protect against?

Coverage E (Personal Liability) in a standard homeowners policy protects the insured against claims and lawsuits for bodily injury or property damage to others for which the insured is found legally responsible — for example, a visitor who slips and is injured on the property, or damage the insured accidentally causes to someone else's property. It typically pays both the damages (up to the policy limit) and the legal defense costs. This is distinct from the property coverages (A–D) that cover the insured's own dwelling and belongings. A related coverage, Medical Payments (Coverage F), pays smaller medical bills for guests regardless of fault. Understanding homeowners liability coverage is core content.