If a property is insured for £10,000 with insurer A and £15,000 with insurer B, and there is a loss of £13,500, how much will insurer B pay using the independent liability method?

To determine how much insurer B will pay using the independent liability method, we must first understand how this method allocates potential payments for a loss among multiple insurers involved.

In this situation, the total insurable value of the property is the sum of the individual policies: £10,000 from insurer A and £15,000 from insurer B, which totals £25,000. Given that the total loss incurred is £13,500, we need to establish the proportions of coverage provided by each insurer in relation to the total insurance.

Insurer A's contribution to the total insurance is calculated as follows: £10,000 divided by £25,000, yielding a 40% share of the total insurance. Insurer B’s contribution, on the other hand, is £15,000 divided by £25,000, resulting in a 60% share.

To find out how much each insurer will pay towards the claim, we then apply these percentages to the actual loss of £13,500.

For insurer B:

• 60% of £13,500 results in: 0.60 x £13,500 = £8,100.

However, we must also consider the actual limit of insurer B's coverage,