A condition that states that the insurer will only be responsible for a proportional share of an insured loss when the insured also has other insurance written according to the same plan, terms and conditions is known as?

The correct answer is the pro-rata liability provision. This provision is significant in the context of multiple insurance policies covering the same risk. It dictates that when an individual has more than one insurance policy that covers the same loss under the same conditions, the insurer will only cover a portion of the claim that is proportional to the amount of coverage it provides compared to the total amount of coverage available from all policies combined.

This approach ensures fairness in the insurance process, preventing the insured from profiting from multiple policies while treating each insurer equitably based on their share of the total coverage. For instance, if an insured carries two policies for the same risk, and one covers 60% of the total exposure while the other covers 40%, in the event of a loss, the pro-rata liability provision would ensure that each insurer pays its corresponding share of the loss.

The other options relate to different concepts in insurance. The coinsurance clause typically requires the insured to maintain a minimum amount of insurance relative to the value of the property to avoid penalties in the event of a claim. The coverage limit provision sets a maximum amount that an insurer will pay for a covered loss. The deductible clause specifies the amount that the insured must pay out-of-pocket before the insurance coverage kicks