View Full Version : Right Censoring with Limits and Deductibles
10-26-2003, 03:22 PM
Please let me know which statement is correct. I think it is number one, since limits are applied before deductibles.
1. Ground up losses above amount u are right-censored.
2. Ground up losses above amount u + d are right-censored.
10-27-2003, 07:42 AM
Policy limits are usually applied before deductibles, but policy maximums are not. Be very careful about the phrasing b/c it could be referring to a maximum payment rather than a total loss limit.
10-27-2003, 09:26 AM
I looked back at the question and it says that u is the maximum insurance payment. I was thinking of it in the context of u being the policy limit.
Thanks for the help - I really appreciate it! I will have to be sure to read more carefully on the exam.
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