Potential Double Indemnity Arising Between BI and Material Damage Policies
A potential overlap between the indemnity provided by a material damage policy and a business interruption policy can arise when stock (inventory) which has been the subject of some conversion process by, or on behalf of, the Insured, is damaged and a simultaneous claim is made for loss of gross profit.
Although there is little controversy over the principle that double-indemnity should not occur, the method of achieving this objective needs discussion. This is the purpose of this paper.