What type of adjustment occurs when repair costs surpass the policy limit?

When repair costs surpass the policy limit, a partial claim adjustment is applicable because the insurance company will only reimburse up to the maximum limit stated in the policy. In situations where the cost of repairs exceeds this limit, the policyholder may receive compensation for the amount covered, but they will have to absorb the remaining costs out of pocket. This is indicative of a situation where the total loss is not applicable since a total loss adjustment refers to damages that completely exhaust the policy limit when the value of the insured property is significantly diminished or destroyed.

In contrast, a complete claim adjustment would imply that the claim is fully settled with the maximum benefits being paid out as defined in the policy, which is not the case when repair costs exceed the limits. A total loss adjustment relates specifically to claims where the entire insured value is claimed due to total destruction or loss of the property. Meanwhile, a reserve adjustment deals with the management of funds set aside for future claim payouts, which doesn't directly refer to the situation of repair costs exceeding policy limits. Thus, a partial claim adjustment effectively captures the essence of the scenario wherein the repair exceeds what the insurer is obligated to pay.