{"id":6819,"date":"2021-07-13T09:39:57","date_gmt":"2021-07-13T09:39:57","guid":{"rendered":"https:\/\/swaritadvisors.com\/blog\/?p=6819"},"modified":"2021-07-13T10:04:39","modified_gmt":"2021-07-13T10:04:39","slug":"insurance-companies-liability-in-case-of-double-insurance","status":"publish","type":"post","link":"https:\/\/swaritadvisors.com\/blog\/insurance-companies-liability-in-case-of-double-insurance\/","title":{"rendered":"How do Insurance Companies Steer Clear of Their Liability in Case of Double Insurance?"},"content":{"rendered":"\n<p class=\"has-drop-cap\">There may be certain conditions wherein an individual may come across few examples wherein they may find that they had taken overlapping insurance covers over a similar subject matter. So does these overlapping insurance cover indicates that he or she has obtained extra protection over the subject matter, or is it simply money wastage? Such questions bring to use the most confusing part of insurance law that is the <strong><em>Law of Double Insurance<\/em><\/strong>. This blog aims to deliver few insights into the idea of Double or Multiple Insurance and make them recognize the different clauses in an insurance policy by use of which an insurer can steer clear of their liability in case of Double Insurance.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3a9fac53903\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3a9fac53903\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/swaritadvisors.com\/blog\/insurance-companies-liability-in-case-of-double-insurance\/#Double_Insurance_%E2%80%93_An_Overview\" title=\"Double Insurance \u2013 An Overview\">Double Insurance \u2013 An Overview<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/swaritadvisors.com\/blog\/insurance-companies-liability-in-case-of-double-insurance\/#What_are_the_Different_Features_of_Double_Insurance\" title=\"What are the Different Features of Double Insurance?\">What are the Different Features of Double Insurance?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/swaritadvisors.com\/blog\/insurance-companies-liability-in-case-of-double-insurance\/#Sum_Recoverable_in_Double_Insurance\" title=\"Sum Recoverable in Double Insurance\">Sum Recoverable in Double Insurance<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/swaritadvisors.com\/blog\/insurance-companies-liability-in-case-of-double-insurance\/#Different_Clauses_that_the_insurers_use_to_Steer_Clear_of_their_Liability\" title=\"Different Clauses that the insurers use to Steer Clear of their Liability\">Different Clauses that the insurers use to Steer Clear of their Liability<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/swaritadvisors.com\/blog\/insurance-companies-liability-in-case-of-double-insurance\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Double_Insurance_%E2%80%93_An_Overview\"><\/span>Double Insurance \u2013 An Overview<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Double Insurance is the way of getting a similar risk or the similar subject matter insured with exceeding one insurance company or with a similar insurance company but by two dissimilar policies. No rule under the <strong><em>Insurance Act, 1938<\/em><\/strong>, or under any other rule, for the time being, forbids double Insurance; instead, the Insurance Act provides the idea of multiple Insurance. The legal meaning of double Insurance is provided under <strong><em>Section 34 of the Marine Insurance Act, 1963<\/em><\/strong><sup><a href=\"https:\/\/indiankanoon.org\/doc\/1401150\/\" class=\"text-primary\"><strong>[1]<\/strong><\/a><\/sup>. So, every individual is at freedom to take as many policies on a similar subject as they want. The idea of double Insurance is possible in all different insurances types, may it be general or life or health.<\/p>\n\n\n\n<p>In\nsome of the examples, people intentionally obtain their property insured with\nmany policies; however, there are certain conditions wherein an individual may\nunintentionally fall into the danger of multiple Insurance. For example, when I\nride your bike with your consent, in this case, I have the third party insurance\ncover under my own policy, and I also have the safety under your <strong><em>Motor\nVehicle Insurance Policy<\/em><\/strong>. Thus, in such a case, the problem arises when\nboth of these insurance policies have an &#8220;<strong><em>Escape Clause<\/em><\/strong>\u201d, by which\nboth of these insurers may avoid their liability. Hence, it is vital for the\npublic to know the clauses.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_the_Different_Features_of_Double_Insurance\"><\/span>What are the Different Features of Double Insurance?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Following\nare the different features of Double Insurance:<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter is-resized\"><img decoding=\"async\" loading=\"lazy\" src=\"https:\/\/swaritadvisors.com\/blog\/wp-content\/uploads\/2021\/07\/image001-9.png\" alt=\"What are the Different Features of Double Insurance?\" class=\"wp-image-6822\" width=\"499\" height=\"457\" srcset=\"https:\/\/swaritadvisors.com\/blog\/wp-content\/uploads\/2021\/07\/image001-9.png 998w, https:\/\/swaritadvisors.com\/blog\/wp-content\/uploads\/2021\/07\/image001-9-300x274.png 300w, https:\/\/swaritadvisors.com\/blog\/wp-content\/uploads\/2021\/07\/image001-9-768x703.png 768w\" sizes=\"(max-width: 499px) 100vw, 499px\" \/><\/figure><\/div>\n\n\n\n<ol><li><strong><em>Same Interest<\/em><\/strong>:\nThe interest desires to be the same in all the relevant insurance policies.<\/li><li><strong><em>Same Insured<\/em><\/strong>:\nThe insured individual should always be the same in double insurances; if the\nsame individual is not entitled to the advantages of all the policies, it\ncannot be termed as double or multiple Insurance. <\/li><li><strong><em>More than Single Policy<\/em><\/strong>:\nA specific subject matter needs to be insured with more than one Insurer or\nwith a similar Insurer but by two dissimilar policies.<\/li><li><strong><em>Same Subject<\/em><\/strong>:\nAll the insurance policies must be the same risk or a similar matter; if it&#8217;s\nnot the same, it cannot be called double Insurance.<\/li><li><strong><em>Same Period<\/em><\/strong>:\nThe time or period for which the policy running should be the same.<\/li><\/ol>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Sum_Recoverable_in_Double_Insurance\"><\/span>Sum Recoverable in Double Insurance<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>In the case of double Insurance, the total recoverable varies in Life Insurance &amp; General Insurance. Since life insurance deals are not the contract of protection and are possible in nature, the full amount can be alleged from all the insurance policies. However, this condition varies in the case of general insurances, as we recognize that general insurance contracts are contracts of Insurance, so nothing above the actual loss can be recovered. In such cases, the Principle of contribution will be applied, and each Insurer will have to pay their relevant share accordingly. An insured is not eligible to recover in complete from all the insurance companies; if such recovery is granted, then it will be against the public policy. It should further be noted that if the loss experienced is more than the real value of the policies; then a complete amount can be claimed from all the insurers. So from a sums recoverability outlook, Life Insurance Policies may prove to be advantaging. On the other side, it may prove to be unfavorable to the interest of an insured.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Different_Clauses_that_the_insurers_use_to_Steer_Clear_of_their_Liability\"><\/span>Different Clauses that the insurers use to Steer Clear of their Liability<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Generally,\nmost insurance companies include &#8220;Other Insurances&#8221; clauses in all\nthe policies so as to avoid their liability in the case of Double Insurance. As\nper the universal rule, all the insurance holders are eligible to claim the\nloss experienced to them from whatever insurance company they desire, but to\nrestrict the application of the idea of double Insurance &amp; the doctrine of\ncontribution, the insurers use such clauses.<\/p>\n\n\n\n<p>Usually, the<strong> <a href=\"https:\/\/swaritadvisors.com\/insurance-company-registration\" class=\"text-primary\">insurance company<\/a> <\/strong>uses the following clauses to avoid their liability in the case of Multiple Insurance. They can use any one or combination from the following clauses:<\/p>\n\n\n\n<ul><li><strong>Notification Clause:<\/strong> According to this clause, the insured individual is required to given written notice to the insurance company if he or she gets a similar risk insured with some other company; if the insured fails to supply such notification, the liability of the former insurance entity will be avoided. It is appropriate to note here that the insured individual has to give a notice in writing only oral notification didn\u2019t work.<\/li><\/ul>\n\n\n\n<p>Usually,\nsuch clauses are inserted by the words: No claim will be considered if the\ninsured didn&#8217;t give notice of any earlier or ensuing Insurance taken on the\nsame matter. This clause is examined by the court in numerous cases; some\nessential cases on this point are F&amp;B Trading Co. Vs Stradfast Insurance\nCo. (1972) and Sandhers vs Australian Agricultural Co. (1875).<\/p>\n\n\n\n<ul><li><strong>Excess Clause: <\/strong>According to this clause, the liability of one Insurer will begin only in case when the loss experienced crosses the limit of the other Insurance. <\/li><li><strong>Liability Exemption Clause:<\/strong> According to this clause, the Insurer accepts their liability upon a condition that, if the similar risk is insured somewhere else also, then, in this case, their liability will not occur. Such clauses save the insurers from two different types of liability:<ol><li>If the Insurer takes the claim from any single insurance policy, then the past Insurer will be released to that extent;<\/li><li>In case of any loss, exemption from the liability to indemnify the insured.<\/li><\/ol><\/li><\/ul>\n\n\n\n<p>These\nclauses may also be known as &#8220;Escape Clauses&#8221;. Usually, such clauses\nare included by the words: If the liability covered under this insurance policy\nis insured with any other policy, either completely or in part, we will not be\naccountable to pay any damages, loss, etc. <\/p>\n\n\n\n<ul><li><strong>Rateable Proportion Clause:<\/strong> By the addition of such clauses, the insurance entities can steer clear of partial liability. According to this clause, one insurance company will only cover a bit of loss, is some other insurance policy also reply on the same risk.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>In\nthe end, we can conclude that double insurances are the ones wherein the\nsimilar subject matter or risk is insured with more than one insurance company\nor with the similar Insurer but with dissimilar policies. The way of double\nInsurance can also be known as Multiple Insurance. The sums recoverable in\nthese cases of Multiple Insurances can never exceed the total amount of loss (except\nin Life Insurance Contracts). In multiple insurances, the standard of\ncontribution is the key to deciding the proportion of amount each insurance\ncompany is liable for.<\/p>\n\n\n\n<p>Moreover, we have seen various types of clauses in which the insurance company uses to steer clear of their liability in multiple insurances. We also look as to what happened in the cases in which both insurance companies includes such exemption clauses in their policies.  In the end, it can be concluded, taking multiple Insurance does nothing else than raising problems for you. It does not raise the sums recoverable; rather, it delays the amount payable &amp; raises an issue for us. <\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/swaritadvisors.com\/blog\/insurance-broking-opportunities-critical-aspects\/\">Insurance Broking Opportunities &amp; Critical Aspects \u2013 An In-depth View<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>There may be certain conditions wherein an individual may come across few examples wherein they may find that they had taken overlapping insurance covers over a similar subject matter. So does these overlapping insurance cover indicates that he or she has obtained extra protection over the subject matter, or is it simply money wastage? Such [&hellip;]<\/p>\n","protected":false},"author":6,"featured_media":6821,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[43],"tags":[749],"acf":[],"_links":{"self":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/6819"}],"collection":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/comments?post=6819"}],"version-history":[{"count":8,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/6819\/revisions"}],"predecessor-version":[{"id":6831,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/6819\/revisions\/6831"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/media\/6821"}],"wp:attachment":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/media?parent=6819"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/categories?post=6819"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/tags?post=6819"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}