Which of the following best defines "Physical Damage" in an insurance policy?

"Physical Damage" in an insurance policy specifically refers to the tangible damage or destruction of the insured’s vehicle. This coverage is designed to protect the policyholder against loss caused by incidents such as collisions, theft, vandalism, fire, or other physical events that can cause harm to the insured vehicle.

In the context of auto insurance, physical damage coverage typically consists of two components: collision coverage, which pays for damage to the vehicle resulting from a crash, and comprehensive coverage, which addresses damage from non-collision events. This definition aligns closely with the notion of protecting the monetary investment of the policyholder in their vehicle.

The other options describe different types of liabilities or coverage areas that do not fall under the definition of "physical damage" related to vehicles. For instance, injury from a third-party accident addresses bodily injury liability, damage to commercial property pertains to business insurance, and loss of income from business interruption relates to property coverage rather than to physical damage of vehicles. Thus, these choices do not encompass the focus of "physical damage" which is specifically about the physical impact on the vehicle owned by the insured.