What is the insurer responsible for in a motor vehicle liability policy?

In a motor vehicle liability policy, the insurer is responsible for transacting business for the benefit of the insured. This means that the insurer must ensure that the policy provides coverage that protects the insured against potential liabilities arising from motor vehicle accidents. The primary purpose of a liability policy is to defend the insured in case of claims made against them for damages they may have caused while operating a vehicle.

It is essential for insurers to establish trust with their policyholders by ensuring that they adequately cover various risks associated with vehicle operation. This involves not just providing basic liability coverage but also being responsive to the needs of the insured, which may include providing coverage for bodily injury, property damage, and other related expenses.

The other options do not accurately reflect the responsibilities of the insurer. Operating without oversight does not align with the regulatory framework that governs insurance practices. Minimizing coverage options would counter the primary objective of insurance—providing adequate protection. Only covering damages caused by the insured does not fully capture the insurer's role, as they are also responsible for the legal defense in claims made against the policyholder, not just covering damages. Therefore, option B, highlighting the insurer's responsibility for the benefit of the insured through comprehensive coverage, is the most accurate statement.