The attachment point is the level at which an Excess Liability policy may begin responding above the underlying insurance. The excess layer does not normally respond from the first dollar of a liability claim.

How does an attachment point work? #

For example:

• Primary Liability limit: $20 million.
• Excess Liability attachment point: $20 million.
• Excess Liability limit: $20 million.

Subject to both policies, the excess layer may respond to the portion of an insured claim above $20 million, up to its own limit.

Must the underlying insurance be exhausted first? #

Generally, the underlying limit must be exhausted in the manner required by the excess policy before the next layer responds.

The policy wording may specify which payments count towards exhaustion and whether the underlying insurer, insured or another party must make them. This becomes particularly important when a claim is settled below the underlying limit or coverage is disputed.

Can a program have several attachment points? #

Yes. A layered program might contain:

• $20 million primary cover.
• $20 million excess of $20 million.
• $10 million excess of $40 million.

This may create a total $50 million program, subject to the terms of every policy.

What if the underlying limit changes? #

Reducing the primary limit without amending the excess policy can create an uninsured gap. The policy periods, insured activities, territorial scope and limits should also align across the program.

Tell Webber Insurance before changing any underlying policy. Each layer should be reviewed together so its attachment point and coverage remain compatible.