Most (UK) insurance policies have a "dual insurance" clause along the following lines:
If any injury, loss, damage or liability is covered by any other insurance then we will not pay more than our proportion.
I understand why (to guard against double recovery), but:
- How is "our proportion" calculated? Does it relate to premium paid, sum insured, value of claim?
- What happens to the excess amounts - does each insurer pay "their share" less the excess you agreed with them?
Partly I'm just curious, but I do want to understand the implications of dual insurance because when shopping around for deals it isn't always easy to avoid. As an example, imagine that I have home insurance with cover for contents away from the home ("personal possessions cover" or whatever a particular insurer calls it). Then I find a good annual travel insurance deal that includes baggage cover as standard though I don't need it. The travel insurance baggage cover is effective only in specific circumstances (with some UK insurance, travelling abroad or staying away with at least 2 night pre-booked accommodation) so I would want to keep the "contents away from home" cover, but in those specific circumstances I would then be dual insured.