Which of the following is true regarding "casualty insurance"?

Casualty insurance is a type of insurance that provides liability coverage for injuries and damages that an insured may be responsible for. This includes coverage for claims made against the policyholder due to negligent acts that cause bodily injury or property damage to another party.

The definition encompasses a variety of scenarios in which an individual or organization may be held liable, thus ensuring financial protection against lawsuits, legal judgments, and settlements that could arise from such claims. This aspect is critical because it not only secures the insured's financial interests but also plays a vital role in maintaining legal compliance and offering peace of mind.

Conversely, other options present limitations or inaccuracies regarding what casualty insurance entails. Focusing solely on property damage oversimplifies the purpose of casualty insurance, which encompasses liability rather than just property aspects. Similarly, stating that it is applicable only to personal items is misleading, as casualty insurance also covers business liabilities and situations beyond personal items. Lastly, asserting that it is less important than property insurance fails to acknowledge that both types of insurance are essential in their own right, serving different but complementary purposes in risk management.