What additional benefit do Supplementary Payments provide in a liability policy?

Supplementary Payments in a liability policy offer additional benefits beyond the basic coverage limits specified in the policy. This aspect allows the insurer to cover specific costs that might arise during a liability claim, which can often exceed the limits of liability insurance.

These payments are particularly beneficial as they can include costs such as legal defense fees, court costs, and certain expenses that are not included in the standard policy limits. By offering this financial buffer, Supplementary Payments can help policyholders avoid out-of-pocket expenses that might arise during the claim process, providing broader financial protection and peace of mind.

The other options do not accurately reflect the nature of Supplementary Payments. They do not cover the full cost of damages, nor do they eliminate the need for deductibles or convert liability coverage into property coverage. Therefore, the answer highlights the importance of having such provisions in a liability policy, ensuring that policyholders are further protected in various circumstances.