Crushing Blow is a special magic property added to certain Set, Crafted or Unique Items, but not to Magic or Rare Items. When striking, a crushing blow will reduce an enemy's life by a certain percentage as follows:
Because Crushing Blow items can stack, it is possible to get up to 100% chance for Crushing Blow.
Physical resistance does apply to Crushing Blow damage, as long as the enemy has a positive physical resistance.
Crushing Blow removes a portion of the enemy's current life, not its maximum life; so, for example, hitting Hell Diablo when he has 40,000 hit points left will remove 5,000 hit points (12.5% x 40,000), not 12.5% of his original total.
Since 1.10, Crushing Blow is calculated before any other damage is applied.