Under pro-rata other-insurance clause, would the combined payments equal the total loss up to the combined limits?

• A. Yes, the total paid equals the loss, up to the combined limits.
• B. No, the higher-limit policy pays first
• C. No, the combined payment cannot exceed any single policy's limit
• D. Yes, but only if the loss does not exceed the sum of limits

Answer: (A)

Under pro-rata other-insurance, each insurer pays a share of the loss proportional to its policy limit relative to the total of all applicable limits. The payments from all insurers are added together and cannot exceed the actual loss or the combined limits.

If the loss is less than or equal to the sum of all policy limits, the proportional shares add up to the full loss, so the total payments equal the loss. For example, with two policies having limits of 100k and 300k, a 150k loss would be split as 37.5k from the first and 112.5k from the second, totaling 150k. If the loss exceeded the combined limits, the total paid would stop at the combined limit amount.

So yes—the combined payments will equal the loss, up to the combined limits.