What happens if an insured has multiple forms of insurance of the same type with one company?

When an insured holds multiple forms of insurance of the same type with one company, they may find that the policies have specific terms that govern how benefits are paid in the event of a claim. In many cases, insurers have guidelines to prevent "double dipping," which means that the insured cannot claim more than the actual loss. Therefore, when a claim is made, the benefits may be limited to cover only a portion of the loss rather than providing a payout that exceeds the incurred damages. This often results in the insured receiving limited paid benefits based on the coverage limits across policies.

Additionally, if the total premiums paid for these overlapping policies exceed the amount that is actually needed for coverage, the insurer might issue a refund for the excess premiums. This scenario aims to ensure that the insured is not profiting from multiple policies covering the same risk or loss but rather being fair and reasonable in terms of compensation. Thus, the insured may receive specific benefits aligned with their total coverage and potentially a refund for any overpayment linked to the redundancy of coverage.