Professional liability insurance would generally cover such settlements and legal defense, within policy limits.

They also include information on how property is insured - applying, for instance, deductibles and policy limits.

Rogerson's homeowner's insurance company paid his policy limit of $100,000 plus $2,000 in medical benefits.

The limits built into the human body, he argued, provided natural, and thus ultimately necessary, policy limits.

When a policy limit has been reached and an excess applies, the following procedure should be adopted.

For example, assume an insurer sells 1000 policies, each with a $1 million policy limit.

The total is only $4,000 short of the policy limit.

It has been agreed that we will deduct the excess from the loss and then pay up to the policy limit where applicable.

It will be deducted from the loss and payment then made up to the policy limit.

This came to £20,938, rather than the policy limit of £15,500.