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, when a loss is also covered by other insurance, the dwelling policy is designed to cover the loss proportionately with the other insurance.

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

This option is incorrect because the dwelling policy does not operate on a primary basis when there is other insurance involved. Instead, it coordinates coverage by sharing the loss proportionately with the other policy.

B) cover the loss proportionately with the other insurance

This is the correct answer as it accurately reflects the principle of the 'other insurance condition'. The dwelling policy adjusts its coverage to share the loss with any other applicable insurance, ensuring that the total payout does not exceed the total loss.

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 function primarily as excess insurance. The 'other insurance condition' stipulates that losses are covered proportionately, not that one policy is secondary to another.

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

This option is also incorrect. The dwelling policy will still provide coverage, but it will do so in a manner that is proportional to the coverage offered by the other insurance. It will not completely negate its responsibility.

Conclusion

The correct answer, option B, is definitive as it aligns with the 'other insurance condition', which emphasizes proportional coverage rather than a primary or excess arrangement. All other options fail to accurately represent how the dwelling policy interacts with additional insurance policies, thereby reinforcing the importance of understanding insurance coordination in loss situations.