What is an insurance exhaustion clause?

An insurance exhaustion clause is a clause in an insurance policy that states that the policy holder is required to use up the benefits of the policy before they can apply for any additional benefits outside of the policy. For example, in New Hampshire, a policyholder may have an insurance policy that covers medical expenses up to $10,000. However, if the policyholder has incurred more than $10,000 in medical expenses, they may not be able to get any additional coverage until they exhaust the benefits of their policy. The purpose of an insurance exhaustion clause is to ensure that the policyholder is able to use up the benefits of the policy before they are able to get any additional coverage. This helps to ensure that all policyholders are able to benefit from their policy and that the policyholder is not left with a large amount of debt if they are unable to get any additional coverage. In New Hampshire, insurance exhaustion clauses are enforced in insurance litigation law. If the policyholder is found to have violated the clause and is unable to provide satisfactory evidence that the policy was exhausted before seeking additional coverage, the courts may impose fines or damages. Therefore, it is important for policyholders to abide by the exhaustion clause and make sure that they have used up the benefits of their policy before seeking additional coverage.

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