Difference In Conditions

Summary of Difference In Conditions

A provision found in some insurance policies that provides coverage for risks omitted in other policies. Difference in conditions coverage is commonly used in relation to marine cargo risks where a buyer is purchasing goods on C.I.F. basis and the insurance coverage provided by the seller is less comprehensive than that of the buyer's policy. In this case, the buyer would not have to insure again, under his own policy, for the shipment, but could employ the difference in conditions clause, which permits him to insure against those perils not covered in the supplier's policy. In the event of a loss covered by the supplier's policy, that policy would respond; where the loss would not have been covered by the supplier's insurance but is within the scope of the (broader) purchaser's policy, that policy would address the claim.

(Main Author: William J. Miller)