A software designed to find out equitable distribution of funds in conditions the place insurance coverage protection is inadequate to cowl all losses or claims. It operates on the precept of proportionality, allocating the accessible settlement quantity to every claimant based mostly on a pre-determined share of their complete declare worth. For instance, if complete claims towards a coverage quantity to $200,000 and the coverage restrict is $100,000, every claimant would obtain 50% of their particular person declare.
Any such calculation ensures equity and transparency within the settlement course of when coping with restricted insurance coverage sources. It gives a scientific strategy to dividing the accessible funds, stopping arbitrary or biased distribution. Traditionally, strategies for allocating restricted insurance coverage funds had been typically topic to dispute and potential litigation. Implementing a proportional allocation streamlines the process, reduces potential conflicts between claimants, and presents a extra predictable consequence.
