WHERE THERE ARE MULTIPLE EXCESS COVERAGE POLICIES COVERING THE SAME RISK, THE EXCESS COVERAGE CLAUSES CANCEL EACH OTHER OUT (FOURTH DEPT).
The Fourth Department, reversing (modifying) Supreme Court, explained how multiple “excess coverage” insurance policies should be applied:
“[W]here there are multiple policies covering the same risk, and each generally purports to be excess to the other, the excess coverage clauses are held to cancel out each other and each insurer contributes in proportion to its [policy] limit,” unless to do so would distort the plain meaning of the policies … . By contrast, “if one party’s policy is primary with respect to the other policy, then the party issuing the primary policy must pay up to the limits of its policy before the excess coverage becomes effective” … . Kolli v Kaleida Health, 2024 NY Slip Op 03998, Fourth Dept 7-26-24