What is cross liability insurance?
Cross liability insurance happens when someone who is insured files a claim against another insured person who has the same policy. This plan covers the insured who has been hit with the claim in the same way as if they had belonged to separate policies. Even so, cross liability insurance does not increase the insurance company’s limit of liability.
In other words, each of the insured gets treated as a separate entity even though they are under the same policy. The cross liability insurance clause is a fundamental “separation of insureds” feature of a general liability policy. Insurance companies handle this clause differently from one another. Some will use the separation of insureds condition and pay for the claim or lawsuit. Other companies will cross out liability and say that they do not have to pay the claim.
If you are injured by another person who is insured under your policy, cross liability insurance is extremely useful because you will want the insurance company to cover your damages.
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