Dual insurance

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Dual insurance
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Dual insurance (alternative term for double insurance) According to J. Clark: "dual insurance is insurance cover against the same risk with two different insurers. In practice, it is impossible to receive more than the value of the cover, and in many cases one insurer would require a contribution to the claim from the other insurer." [1].

The insured has the right to insure one particular aspect in many of insurers. The concept of double insurance aims to provide protection to the insured. At the time of the loss, the assured person may make a claim to more than one entity - covering the same loss with help of many insurers[2].

There are several reasons why an insured person should have dual insurance [3]:

  • This is the only way to protect assured from insolvency. Applies to the moment when, due to insolvency, the insurance is taken out, without the knowledge of the assured, by another person.
  • It is a protection against the possible rise of existing insurance costs.
  • In the case of double health insurance, solvency for damages can reach nearly 100% of the actual value and even exceed it.


Before using dual insurance, everyone interested should meet certain requirements. The first and the most important point is the need to cover the same property. The insurance-covered aspect does not necessarily have to be exactly the same thing. When two insurance policies cover the same risk, there is double insurance. Further, the policies must cover the same interest and the same security. The other rules are not that important and may vary depending on the type of policy[4].

Problems with dual insurance

The existence of double insurance causes a lot of problems. First and foremost, it is about adjusting the liability between the two insurers. The first attempts to solve such problems arose in the area of non-life insurance. At that time, it was common practice to include in the contract a provision that prohibited the insuring party from obtaining another benefit from another insurer. A whole range of regulations were created which regulated the ways of distributing losses between insurers[5].

At present there is a risk of fraud when the insured person takes out an insurance policy. By purchasing multiple insurance policies at the same time, assured person files claims in all of them. Provisions have been introduced to prevent excessive use of insurers by introducing restrictions to ensure that insured persons do not receive more than they are entitled to. Unfortunately, it is not clear enough what order the claim of insurers should be made. The contract has been defined as binding between the insurer and the insured - thus it covers only these two parties[6].

The laws that govern dual insurance are unclear. In some cases, when the same clause record applies to both policies. (e.g. such as escape clauses or excess or rateable proportion clauses) The courts dismiss the proceedings and the insurer is obliged to fulfill the contract [7].


  1. J.Clark, (2014), p.114
  2. N. Mohamed, (2018), 1.1.5.
  3. N. Mohamed, (2018), 1.1.5.
  4. N. Mohamed, (2018), 1.1.6
  5. Wilbur J. Russ, (1961), p.183
  6. N. Mohamed, (2018), 1.1.1
  7. N. Mohamed, (2018), 1.1.8


Author: Sabina Łach