Multiple Coverage

• Author: Denis Boivin
• Pages: 308-319

308

1 See Chapter 1.

A. INTRODUCTION

Multiple coverage occurs when two or more insurance policies cover

the same insurable interest, in the same object, against the same peril.

There is nothing illegal about multiple coverage per se. As long as the

requirements discussed in Chapters 4 through 7 are met, insureds are

free to have as much insurance as they are willing to purchase. In fact,

in the twenty-first century, multiple coverage is sometimes necessary

and often inevitable. It is necessary because insurance providers are not

always willing to shoulder risks alone. Simply put, some risks are too

great for any single insurer to assume. This is why most insurers resort

to “reinsurance” — a product that shifts one insurer’s contractual

responsibilities to another provider.1But for the same reason, some

insureds must subscribe to many policies in order to obtain full cover-

age. Multiple coverage is also inevitable because the consent of insur-

ance consumers is not always requested. As will be discussed in

Chapter 13, insurance policies often extend coverage to individuals

who have not participated in the negotiation process. As a result, the

same person can be the named insured under one contract and a third

party beneficiary under another. Sometimes the insurance coverage

MULTIPLE COVERAGE

chapter 12