Deductible and Excess Coverage, Liability and Property Damage Lines, Other Than Automobile

Relatively few risks under the various Liability and Property Damage lines, other than Automobile, have been written in the past on either a deductible or an excess coverage basis. There is, however, a growing trend toward writing certain types of risks under these lines of insurance on a deductible basis. The reason why these forms of coverage have been given such scant consideration as underwriting tools is undoubtedly that most casualty insurance men are unfamiliar with them as applied to the miscellaneous Liability and Property Damage lines. The advantages of writing deductible or excess coverage in certain cases remain unappreciated because of a lack of knowledge of the mathematical derivation of the discounts, the method of applying the discounts to the basic rates, the method of experience rating such risks, etc. The purpose of this paper is to assemble the available data which may be published in order that there may be a more general understanding of the rate structure for deductible and excess coverages.