Liability · Insurance Term
Property Damage Liability (PD)
Definition
Property damage liability covers damage you cause to other people's property, such as a neighbor's building or a customer's car. It is a core part of general liability and commercial auto policies.
In Plain English
If your business or your property damages something that belongs to someone else, this coverage can pay for the repairs and your legal defense, up to the policy limit. It sits next to bodily injury coverage. Both usually share the each occurrence limit.
It covers other people's property, not your own. Damage to your own building belongs on your property policy. Liability policies also commonly exclude damage to property you own, rent or occupy. There are narrow exceptions, such as damage to premises rented to you.
In a commercial general liability policy, property damage generally means physical harm to tangible property, which is property you can touch. It also includes the loss of use of that property.
Not sure how your policy handles this? Have us review it, or get a quote.
Example
Hypothetical and simplified: a corroded light pole in a strip center's parking lot falls and crushes a customer's car. The customer's claim against the owner would usually go to the owner's general liability policy as property damage liability, if the policy applies.
What to Watch For
- Check your each occurrence limit and general aggregate on the declarations page.
- Remember that damage to your own property belongs on your property policy, not your liability policy.
- If you lease space from someone else, ask about damage to premises rented to you coverage.
Last updated October 14, 2026 · Primesure editorial team · How We Write