Question 119

The dwelling policy will cover the loss proportionately with the other insurance.

In accordance with the 'other insurance condition' of the dwelling policy, if a loss is covered by other insurance, the dwelling policy will share the responsibility for the loss, covering it proportionately alongside the other insurance.

A) cover the loss on a primary basis and the other insurance will be excess

This option is incorrect because the 'other insurance condition' does not provide for the dwelling policy to act as the primary insurer when other insurance exists. Instead, it stipulates a proportional sharing of the loss.

B) cover the loss proportionately with the other insurance

This option is correct as it accurately reflects the principle of proportional coverage outlined in the 'other insurance condition.' The dwelling policy will pay a portion of the loss based on the ratio of its coverage to the total coverage available.

C) cover the loss on an excess basis and the other insurance will be primary

This option is incorrect because the dwelling policy does not operate on an excess basis when other insurance is present. The policy is designed to share the loss proportionately rather than defer to the other insurance entirely.

D) not cover the loss and thus only the other insurance will pay

This option is incorrect as the dwelling policy will not completely exclude coverage when other insurance is available. It will still provide coverage in proportion to the other policy’s limits.

Conclusion

The correct answer is definitively option B, as it aligns with the policy's provisions regarding multiple insurance coverages. Options A, C, and D misinterpret the 'other insurance condition' by suggesting incorrect roles of primary and excess coverage, failing to recognize the proportional sharing principle that governs the interaction of multiple insurance policies.