Also known as: Other Insurance Provision · Primary and Excess Clause · Contribution Clause
A policy condition that decides whether your coverage pays first, pays only after other applicable policies are used up, or shares a loss proportionally when more than one policy could cover the same claim.
An other insurance clause is a standard policy condition that coordinates how coverage responds when two or more policies could apply to the same loss. It usually falls into one of three types: primary, meaning this policy pays first; excess, meaning this policy pays only after other applicable coverage is exhausted; or pro-rata, sometimes called contribution, where each policy pays a share of the loss, often in proportion to its limit. When two policies each claim to be excess to the other, insurers and courts frequently end up prorating the loss between them. For a startup, this language sets the order in which policies get tapped, which affects how fast a claim is paid and whose limits get eroded. It matters most in liability lines like D&O, where a director or officer may also be covered under a personal umbrella or a venture firm's own liability policy.
An other insurance clause is a condition in your policy that dictates how it responds when another policy could also cover the same loss. It defines whether your coverage is primary, excess, or shares the loss on a pro-rata basis with the other insurance. This ordering matters because it controls which insurer pays first and whose limits are drawn down during a claim.
The three common types are primary, where your policy pays first; excess, where your policy pays only after other applicable policies are exhausted; and pro-rata or contribution, where each policy pays a proportional share of the loss. When two policies each claim to be excess to the other, the conflict is often resolved by prorating the loss between the carriers. Reading this clause tells you exactly where your policy sits in the payment order.
An individual director or officer may also have access to a personal umbrella policy or coverage under a venture firm's own liability program. A well-negotiated other insurance clause makes the company's D&O policy primary to those other policies, so a claim does not first erode a director's personal coverage or an investor's limits. That protects the people you recruited onto your board and keeps the intended D&O tower responding as designed.
Definitions are educational and may be modified by your specific policy language, endorsements, and state rules. For regulatory guidance, refer to the California Department of Insurance or the NAIC.
Last updated: July 2026.