Commentary on Sections Section 10: Insurer’s right of set off
47.This section preserves the insurer’s rights to deduct money owed to it by the insured from the monies payable to the third party. For example, this ensures that if the insured has not paid all the premiums for the insurance policy, the insurer can deduct those unpaid premiums when paying the third party’s claim, to the extent to which it would have been entitled to do so had the claim been brought by the insured.