What is the function of contingent insurance?

Contingent insurance serves a specific purpose in the realm of insurance coverage. It is designed to relieve the insurer of its financial responsibility if there is another existing policy that covers the same risk. This means that if a person holds multiple insurance policies that address the same potential loss, the contingent insurance policy is not obligated to pay out unless the other policies are exhausted or unavailable. This type of insurance often operates in a secondary capacity, acting as a backup to the primary coverage.

The other choices do not accurately represent the function of contingent insurance. For instance, increasing the insured amount over time describes a different type of policy feature, while covering damages without limits does not align with the nature of contingent insurance, which typically involves specific conditions for coverage. Additionally, immediate coverage after a claim is more indicative of certain types of policies, which also do not relate to the concept of contingent insurance.