If two policies provide coverage and one is designated as excess because it pays after the other policy, which policy pays first?

If two policies provide coverage and one is designated as excess because it pays after the other policy, which policy pays first?

• A. The excess policy
• B. The other policy
• C. Neither policy
• D. The primary policy

Answer: (D)

When two policies cover the same risk and one is labeled excess, that excess policy is there to pay only after the other policy has paid up to its limits. The primary policy pays first, up to its limits, and only after that is exhausted would the excess policy step in to cover remaining eligible losses, if any. So the policy that pays first is the primary policy. The excess policy wouldn’t pay first, and stating that would contradict how excess coverage is designed to work.

When two policies cover the same risk and one is labeled excess, that excess policy is there to pay only after the other policy has paid up to its limits. The primary policy pays first, up to its limits, and only after that is exhausted would the excess policy step in to cover remaining eligible losses, if any. So the policy that pays first is the primary policy. The excess policy wouldn’t pay first, and stating that would contradict how excess coverage is designed to work.