Exhausted Limits of Liability on Your Architecture/Engineering Firms Professional Liability Policy

This means that when you have a claim and the expenses and settlement have reached the policy limits then your firm is required to pay the balance of the amount due beyond your limits of liability. Here are a few examples of the wording from a few insurance companies.

Example one:

The Company is not obligated to pay any Damages or Claim Expenses or to defend or continue to defend any Claim after the applicable “Each Claim” or “Policy Aggregate” Limits of Liability has been exhausted by the payment of Damages or Claim Expenses or any combination thereof; or after the Company has deposited the remaining available “Each Claim” or “Policy Aggregate” Limits of Liability into a court of competent jurisdiction or tendered the remaining available “Each Claim” or “Policy Aggregate” Limits of Liability to the Named Insured or, if applicable, to the excess insurer(s) of the Named Insured. In such case, the Company shall have the right to withdraw from the further investigation, defense or settlement of such Claim by tendering control of said investigation, defense and settlement of the Claim to the Insured.

Example two:

The Company is not obligated to pay any damages or claim expenses or to defend or continue to defend any claim after the applicable limit of liability has been exhausted by the payment of damages or claim expenses, or any combination thereof; or after the Company has deposited the applicable limit of liability into a court of competent jurisdiction or tendered the applicable limit of liability to the Named Insured or, if applicable, to the excess insurer(s) of the Named Insured. In such case, the Company shall have the right to withdraw from the further investigation, defense or settlement of such claim by tendering control of said investigation, defense and settlement of the claim to the Insured.

Read your firms Professional Liability policy so you are aware of what the exhausted limits definition is in your policy. If you have questions on the Professional Liability exhaustion of limits of liability call or email your Professional Underwriters agent for assistance.