"I guess I was just looking at is as "why would someone pay for the LIS when there is already liability."

For the same reason that many people who own cars opt to pay for higher coverage limits on their personal auto-insurance policies: they have substantial assets that they wish to protect, and/or don't want to be bankrupted in the event of an at-fault accident. The "free" liability coverage that comes with rentals in those handful of states noted on the Hertz website is paltry, and woefully inadequate for many renters.

Don't underestimate how much you could be liable for even from a low-speed collision, if it causes whiplash injuries or sends someone to the hospital: medical bills, lost wages, pain-and-suffering damages, etc.