Higher Deductibles


Clients are increasing deductibles to offset premium increases based on a combination of loss experience, higher rates and higher projected losses from catastrophe models.


“We’re seeing a number of clients that are increasing their deductible, certainly on the bottom.”


Erik Nikodem, Lexington Insurance


While many clients are increasing deductibles at the bottom layers of their insurance program, others are increasing their risk retention across the entire program to effectively offset cost increases resulting from loss experience, projected losses from new catastrophe models and higher rates. Meanwhile, another conversation about deductibles is taking place as a result of the 2011 catastrophes. The current discussion concerns percentage deductibles for hail and other convective storm losses.


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