Payments under the ALTA 2006 form policy reduce the amount of insurance by what?

The ALTA 2006 form policy specifies that payments made under the policy will directly reduce the amount of insurance coverage available. This means that when a claim is paid out, the value of that payment is subtracted from the overall insurance coverage limit. For example, if the policyholder has coverage of $100,000 and a claim of $20,000 is paid, the remaining amount of coverage would then be $80,000. This approach is designed to clarify how the policy operates, ensuring that insured parties understand their remaining coverage after any claims are settled. The other choices, while related to aspects of insurance and claims, do not directly pertain to the mechanism of reducing the coverage amount following a payment made under the policy.