What is the difference between primary and excess insurance?

Primary insurance is the first line of insurance coverage. It provides the most basic coverage when an insured is sued. If the primary insurance coverage is exhausted due to claims or other expenses, excess insurance will kick in and provide additional protection for the insured. Excess insurance is additional coverage that acts as a backup plan. It comes into play when the primary insurance is not enough to cover the costs associated with a claim or lawsuit. Excess insurance will pay out the remaining costs or damages that the primary insurance is unable to cover. Both primary and excess insurance are important components of an insurance policy since they provide two layers of protection. Primary insurance is similar to a first line of defense since it pays out first. However, excess insurance is also necessary as it provides additional coverage that kicks in when the primary insurance isn’t enough. In Louisiana, insurance regulations require that all companies provide a minimum amount of both primary and excess insurance coverage in order to protect policyholders from unexpected losses. By having both primary and excess insurance, policyholders have the peace of mind knowing that they are protected in the case of an accident or lawsuit.

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What is the difference between primary and excess insurance?

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