Establishing Exhaustion of Underlying Policies: Recurring Issues, Factors to Consider, Below Limits Settlements

A live 90-minute CLE video webinar with interactive Q&A

Tuesday, October 26, 2021

1:00pm-2:30pm EDT, 10:00am-11:30am PDT

Early Registration Discount Deadline, Friday, October 8, 2021

or call 1-800-926-7926

This CLE course will review what constitutes exhaustion of an underlying policy, how policyholders can prove it, and what defenses excess insurers may have to coverage triggers.


Even for the most experienced professionals, proving underlying exhaustion can be burdensome and costly. The policyholder has the burden of proof, but insurers will want to test claims of underlying exhaustion, including sometimes seeking review of how the underlying insurer handled and treated underlying claims. Excess carriers sometimes dispute whether all claims paid by underlying policies should be counted toward the applicable underlying limit. At the same time, the insurer that paid claims needs to look over its shoulder regarding reinsurance recovery. Proving proper underlying exhaustion is seldom straightforward.

Policyholders must have a plan and be aware of their options. Determining how multiple policies with differing language and coverages relate to each other can be its own Augean task, including ascertaining which policies follow form to what underlying coverage, factoring the impact of other-insurance and non-cumulation provisions, and considering how multi-year, “stub” policies, and policy extensions affect applicable limits.

Courts also differ on what constitutes "exhaustion" and how to prove exhaustion when a settlement or judgment encompasses covered and uncovered claims, such as a settlement that includes a release of uncovered punitive-damages claims. Counsel also should understand whether a settlement with one insurer for less than its full policy limits concurrently forfeits any overlying excess coverage; policy language and case law (Qualcomm and others) continue to develop in this area.

Listen as the panel discusses what factors must be shown to establish exhaustion, the various types of evidence, data, statistics, and other tools to show exhaustion, and the best approaches for counsel.



  1. Overview of exhaustion
  2. Factors to establish exhaustion
  3. Types of evidence, data, statistics, and other tools to show exhaustion
  4. Problems encountered in showing exhaustion
  5. Best strategies for showing exhaustion


The panel will review these and other issues:

  • How do underlying policy language and wording affect exhaustion?
  • What types of experts are needed?
  • How is exhaustion shown through loss runs, claims data, and various types of allocations?
  • Is exhaustion ever possible with a below-limits settlement under the underlying policies?


Eddy, Janie
Janie Reilly Eddy

Saxe Doernberger & Vita

Ms. Eddy has a strong background in litigation, handling matters from inception through resolution and advising and...  |  Read More

Mayerson, Marc
Marc S. Mayerson

The Mayerson Firm

Mr. Mayerson specializes in complex insurance-coverage disputes including litigation, settlement and advice, and...  |  Read More

Perry, Anna
Anna M. Perry

Saxe Doernberger & Vita

Ms. Perry has a wealth of experience in contract reviews, insurance program evaluations, and coverage analysis.

 |  Read More
Attend on October 26

Early Discount (through 10/08/21)

Cannot Attend October 26?

Early Discount (through 10/08/21)

You may pre-order a recording to listen at your convenience. Recordings are available 48 hours after the webinar. Strafford will process CLE credit for one person on each recording. All formats include course handouts.

To find out which recorded format will provide the best CLE option, select your state:

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