Severability of Interests
Key Takeaway
A policy provision stating that the insurance applies separately to each insured, as if each had their own individual policy. This ensures that the acts, omissions, or knowledge of one insured do not impair the coverage of another insured under the same policy.
Definition
A policy provision stating that the insurance applies separately to each insured, as if each had their own individual policy. This ensures that the acts, omissions, or knowledge of one insured do not impair the coverage of another insured under the same policy. This is closely related to the innocent insured provision.
Why This Matters for Law Firms
Understanding this concept is essential for law firms because it directly affects how your coverage responds when a claim is filed. Misunderstanding policy structure terms can leave your firm exposed to uninsured losses, particularly during carrier transitions or when claims surface years after the underlying work was performed.
Example Usage in Context
A managing partner reviewing the firm's renewal materials might ask the broker: "Can you confirm our severability of interests aligns with what we had under the prior carrier? We want to make sure there are no gaps in our retrospective protection."
Related Q&A
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