What does the term "Strict Liability" refer to in the context of insurance?

The term "Strict Liability" specifically refers to a legal doctrine that holds a party responsible for their actions or products, regardless of fault or intent. In the context of insurance, this often pertains to situations involving defective products. Under strict liability, a manufacturer or seller can be held liable for any injuries or damages caused by a product, as long as it is proven that the product was defective or unreasonably dangerous, irrespective of whether they exercised reasonable care in its production or sale.

This principle is designed to encourage manufacturers to produce safe products and to provide a remedy for individuals who have been harmed by those products, emphasizing consumer protection over the need to prove negligence. Thus, strict liability mainly applies to product-related incidents, making the term absolute liability specifically for products the correct interpretation within this context.