If the excess for a policy is for example USD10,000 or 10% of the adjusted loss (whichever is the greater amount) and the limit of liability for the policy is USD100,000.
What happens if there is a claim for USD2,000,000?
As 10% of the adjusted loss would be USD200,000, (since this provides the greater amount). Would the insurance company have to pay nothing as this excess already exceeds the policy limit of USD100,000.
Or is there an implied term that the 10% of the adjusted loss is subject to the policy limit of USD100,000, and so the insurance company would have to pay USD90,000 over the excess of USD10,000.
Or is there another alternative?
Any actual case illustrations would be much appreciated!
What happens if there is a claim for USD2,000,000?
As 10% of the adjusted loss would be USD200,000, (since this provides the greater amount). Would the insurance company have to pay nothing as this excess already exceeds the policy limit of USD100,000.
Or is there an implied term that the 10% of the adjusted loss is subject to the policy limit of USD100,000, and so the insurance company would have to pay USD90,000 over the excess of USD10,000.
Or is there another alternative?
Any actual case illustrations would be much appreciated!