Limited liability is a legal structure that protects the personal assets of business owners from being used to pay off the company's debts. This means that if a business fails or faces lawsuits, the owners are only responsible for the amount they invested in the business, not their personal savings or property. This concept is commonly associated with business entities like limited liability companies (LLCs) and corporations. This protection encourages entrepreneurship, as individuals can start businesses without the fear of losing their personal wealth. Limited liability also helps attract investors, as they know their financial risk is limited to their investment in the company. Overall, it promotes economic growth by allowing more people to engage in business activities.