Liability policies include the provision of bankruptcy of the insured

Bankruptcy of an insured

This provision is required to be included in liability policies in many states. It provides that the bankruptcy or insolvency of an insured will not relieve the insurer of its obligations under the policy. A claimant can seek relief from the automatic stay afforded to a debtor in bankruptcy to continue to press his or her lawsuit against the insured as long as the claimant limits any recovery to proceeds of the insured's insurance policies.

Other insurance

This condition addresses the question of which policy should pay, and in what order, when multiple policies afford coverage for the same loss. The ISO HO 3 homeowners policy purports to provide that the coverage afforded applies in excess of that of any other policy, except for coverage that is written specifically to apply as excess insurance over the ISO HO 3 policy's coverage. In many cases in which there are true conflicts between the other insurance clauses of multiple policies that apply to the same loss, the result is that the insurers are held to share responsibility for the judgment on a pro rata basis.

Each shares responsibility in the proportion that the policy limit of the respective insurer's policy bears to the total policy limits of all the involved policies. Such conflicts between the other insurance clauses in the homeowners policy context are relatively rare. This is an issue that arises far more commonly in the commercial liability context.

Policy period

This condition states the policy's coverage applies only to bodily injury or property damage that occurs during the policy period. Under the personal injury coverage endorsement, this condition is deleted as to the personal injury coverage. This is because the trigger of personal injury coverage is the insured's commission of a personal injury offense during the policy period. The personal injury endorsement substitutes a condition that so states.

Concealment or fraud

This is an important and broad condition that has the effect of voiding the policy completely for an insured who, whether before or after a loss, has:

intentionally concealed or misrepresented any material fact or circumstance;
engaged in fraudulent conduct; or,
made false statements relating to the insurance. Any false statement or concealment can have the effect of completely voiding the policy.

The concealment or fraud condition of the liability coverage thus differs significantly from that applicable to the property coverages. Under the concealment or fraud condition of the property conditions, the concealment or fraud of one insured will not necessarily void coverage as to other insureds.

Personal injury coverage conditions

The personal injury endorsement has a brief set of conditions. The personal injury endorsement contains limits of liability, severability of insurance, and duties after offense conditions that are substantially identical to their counterparts in the bodily injury and property damage conditions.

1. Insurance coverages have various conditions that apply to them
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2. Structure of the standard personal car insurance policy
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4. Purpose of insurance coverage exclusion for owned or rented property
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5. Provisions applicable specifically to auto liability coverages
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6. Rented and borrowed vehicles and car insurance exclusions
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7. Additional coverages included by car insurance policies
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8. Right to recover payment after a loss or accident
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