Which type of coverage involves compensating for damages related to wrongful acts?

Liability Coverage is specifically designed to provide compensation for damages arising from wrongful acts or negligence. This type of insurance is crucial for protecting individuals and businesses from the financial burden associated with lawsuits or claims made by others due to harm or damage caused by their actions or inactions. It addresses issues such as property damage, bodily injury to others, or personal injury, which includes defamation or invasion of privacy.

In the context of the other options, Property Coverage focuses on protecting physical assets from loss or damage, which does not cover the consequences of wrongful acts directly. Bodily Injury Coverage is a subset that typically refers to coverage for physical injuries to individuals, rather than wrongful acts overall. Personal Injury Coverage often pertains to non-physical harm, such as reputational damage, which is a narrower scope than what liability coverage encompasses. This makes Liability Coverage the most fitting type for compensating damages related to wrongful acts across a broader context.