Where a loss is covered by two or more liability policies of insurance what are the rights of the insurers inter se?
Frequently a loss occurs that is covered by two or more policies of insurance. When this occurs there is immediately a question as to which of the policies is primary and which is excess and as to the rights of the insurers as between themselves to contribution. To resolve these problems “other insurance” clauses were developed. These clauses generally fall into one of three categories. The first type of clause is a pro-rata clause which provides, as the name implies, that both policies shall share the loss pro-rata. The second type of clause is an excess clause which stipulates that the policy in which the clause is contained is excess and the other policy is primary. The third type of clause is called an escape clause. It provides that in the event there is other insurance, the policy will be void or will not contribute. There has been a good deal of case law dealing with competing “other insurance” clauses. Most of this case law has involved situations where the two policies have co
