Texas All Lines Adjuster Practice Test 2026 - Free Practice Questions and Study Guide

Liability insurance for employers is specifically designed to protect them against claims and damages that may arise from the actions of their employees while they are performing their job duties. This type of insurance helps shield employers from financial losses linked to lawsuits or legal claims resulting from employee actions, whether they are negligent or intentional.

In the workplace context, liability insurance can cover incidents such as injuries to third parties or damage to their property caused by employees. By having this insurance, employers can have peace of mind knowing that they will have support in managing legal costs and settlements that might arise from such liability claims.

While other options mention important aspects of workplace coverage, they do not accurately reflect the specific purpose of liability insurance for employers. For example, covering workplace injuries for employees generally falls under worker's compensation, which is distinct from liability insurance. Similarly, insuring employee health benefits and reimbursing for employee theft address different areas of coverage unrelated to liability claims against employers.