Liability

An obligation owed to another party: for a business, an amount it owes to someone else; for an individual, legal responsibility for damage or injury caused to another person or to their property.

A liability can exist before anyone notices it, which is exactly what sales tax collected but not recorded did to Steep Street in year one. In Unit 5 the same word names the personal side: responsibility for harm caused to somebody else, which is what liability coverage on a policy pays for.

3.3.A.1 · 3.7.A.3 · 5.2.B.4