What is the difference between primary and excess insurance?

Primary insurance is a type of insurance which pays out first in the event of a claim or an event that requires compensation. Primary insurance is a basic type of insurance which is normally the first line of defense and is usually applied to cover all costs that occur due to the aforementioned claim or event. Excess insurance is an additional layer of coverage that is used in situations in which the primary insurance may not cover all of the costs associated with a claim or event. The excess insurance will only pay out when the limits or restrictions of the primary coverage have been exceeded. This type of insurance also serves to protect the insurer from being overburdened by expensive claims. In the state of Arkansas, insurance regulation laws require that all primary insurance policies meet the minimum requirements of coverage set by the state. Excess insurance is not regulated by the state, and is purchased at the discretion of the insurer or the insured.

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What is the difference between primary and excess insurance?

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