COB Clause Law and Legal Definition

COB clause is a provision in the insurance policy which states that benefits will not be paid for amounts that are already covered by other organizational health insurers. The object of a COB clause is to ensure that benefits from all eligible sources do not exceed 100% of permissible medical expenses.

Under the generally recognized definition of a coordination of benefits clause in an insurance policy, a provision need only be conditioned on the existence of other insurance and establish an order of payment between the plans. [Farm Bureau Gen. Ins. Co. v. Morton Bldgs., 1998 U.S. Dist. LEXIS 14976 (W.D. Mich. Aug. 28, 1998)]

COB Clause is the abbreviation of Coordination-of-benefits clause.