What is an insurance exhaustion clause?

An insurance exhaustion clause is a clause in an insurance policy that stipulates that the policyholder must first use up or exhaust all coverage offered by the insurer before any additional coverage from another insurer begins. This clause is important because it ensures that all coverage offered by the insured’s policy is utilized before any additional coverage is necessary. In Florida, an insurance exhaustion clause typically will provide that if you have multiple policies in place with different insurance companies, you must exhaust each policy’s benefits before you can pursue any additional coverage provided by another insurance company. This clause is important because it ensures that policyholders receive the full benefit of the coverage they have already paid for. Insurance exhaustion clauses are a vital part of insurance litigation law in Florida. They help clarify the expectations of insurers and policyholders and ensure that the coverage provided is both fair and just. Additionally, insurance exhaustion clauses serve as protection for policyholders, as they ensure that all available coverage is utilized before any additional coverage is needed.

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What is an insurance exhaustion clause?

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