Which of the following best describes the term "excess insurance"?

Excess insurance is defined as a type of coverage that kicks in once the limits of a primary insurance policy have been exhausted. This means that it provides additional coverage beyond what the primary policy offers. It is typically used to protect against very large losses that exceed the limits set by the primary policy.

In understanding this concept, it is clear that option B encapsulates the essential function of excess insurance by stating that it provides additional coverage above primary limits. This is particularly important for individuals or businesses that may face substantial liabilities or losses, ensuring that they have adequate protection when primary insurance coverage is insufficient.

Other options fail to accurately capture the essence of excess insurance. For instance, saying that it applies to losses within the primary limits misrepresents its purpose, as excess insurance does not operate until those limits have been surpassed. Similarly, suggesting that it is meant only for high-value items restricts its relevance, as excess insurance can cover a variety of liabilities, not just those associated with expensive possessions. Finally, the notion that excess insurance is exclusively for bodily injury claims is inaccurate; excess policies are available for various types of coverage, and their applicability extends well beyond just bodily injury. Thus, option B is the most accurate and comprehensive description of excess insurance.