Aviation liability coverage is a type of insurance that protects companies against claims arising from damage caused to others or their property as a direct or indirect result of their aviation-related activities. This includes damage caused by operational activities, employees, baggage, and cargo.

If such a claim is made against an insured company, the insurance covers the legal costs and indemnities for which the company is held liable under the law. This coverage can help protect airlines against the significant financial expenses that can arise from liability claims.