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I have a tour coach operator based in Queenstown. On the day of the Queenstown marathon their coach was directed by the police to go down a street that due to its steepness my client would never use. Although they informed the police that this would result in the coach bottoming out they were forced to drive down the street and when they got to the bottom of the street the coach bottomed out and sustained damage and needed to be towed. In the course of the towing more damage was sustained to the coach. The insurer of the coach has applied two excesses (which is significant due to the value of the coach) as they consider it to be two events. We have been arguing that had the first event not occurred, then the second would have never eventuated and effectively one event and therefore only one excess should apply. 

Reply...  Crossley Gates

The starting point is the words used in the policy that aggregate several excesses into one for the purpose of calculating the excess. Often the policy refers to the excess applying to an event or series of events arising from the same source or cause.
If so, the cause of these events isn't the same. While it is true that the need to tow the vehicle was in consequence of the coach bottoming out, the cause of the damage to the coach from the towing may be unrelated. For example, if the tow truck driver failed to fasten the coach correctly to the tow truck or trailer, this has nothing to do with why the coach bottomed out. Without knowing all the background, it sounds to me that the causes are likely to be different, not the same.
If so, two excesses apply.

Sept 2018

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