Where injury or damage occurs over many years, allocating the loss among policy periods determines how much coverage responds.
All sums. The insured may select any triggered policy and require it to pay the entire loss up to its limits, leaving that insurer to seek contribution. Favourable to insureds and adopted in a number of states.
Pro rata. The loss is allocated across the triggered period by time on the risk, or by time and limits. Periods in which the insured had no coverage, or was self-insured, are the insured’s own share.
Trigger. Which policies are implicated — exposure, manifestation, continuous trigger, or injury in fact — determined by the policy language and by state law, and decisive for the size of the tower.
Unavailability. Whether an insured bears the share for periods in which coverage was unavailable in the market, which several states excuse and others do not.
Exhaustion. Whether an excess policy responds after the underlying limits are exhausted by payment, or also by settlement below limits, which depends on the excess policy’s language.
Settlements with some insurers and the effect on the remaining tower, governed by the allocation method and by any anti-assignment and consent provisions.