Life is full of awkward situations. Liability insurance covers your liability for damage which you can cause to the third party in your civil-life. It is very useful to get this kind of insurance to pay damages that you can cause yourself or that can be caused by family member living with you in the same household. Flooding your neighbours while washing your kids or using washing machine, breaking a vase while doing shopping etc. One general liability insurance can cover all kinds of these damages and it is usually required when you rent an apartment.