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Old 12-10-2019, 11:40 AM
wilsonchan18 wilsonchan18 is offline
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Default Large Deductible Credit

Hi Everyone,

Does anyone know the Premium Reduction causing from the Large Deductible Credit is the same Reduction from say just normal deductible that is Insurance paying out the Net Claim Amount rather than Gross and seek Reimbursement on Deductible from PH as defined from Large Deductible?

Thanks and Cheers,
Wilson
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Old 12-10-2019, 12:11 PM
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therealsylvos therealsylvos is offline
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Quote:
Originally Posted by wilsonchan18 View Post
Hi Everyone,

Does anyone know the Premium Reduction causing from the Large Deductible Credit is the same Reduction from say just normal deductible that is Insurance paying out the Net Claim Amount rather than Gross and seek Reimbursement on Deductible from PH as defined from Large Deductible?

Thanks and Cheers,
Wilson
Typically LDD will include a load for credit risk.

https://www.casact.org/library/study...nda_Fisher.pdf
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Old 12-11-2019, 06:45 AM
wilsonchan18 wilsonchan18 is offline
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Thanks for the reply. It seems here Large deductible means the aggregate deductibles with existing policy deductible.
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Old 12-11-2019, 08:53 AM
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Maphisto's Sidekick Maphisto's Sidekick is offline
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In the US, some large account contracts include an aggregate retention/deductible limit - an upper bound on the retention/deductible the insured is required to pay.

When I priced such contracts, there was an explicit calculation of the frequency of the occurrence of that condition and the conditional marginal severity (especially expenses) for such.

EDIT: I just realized this is in an exam forum (I was skimming new posts). My answer was a real-world answer, and as such may differ from the course material.

Last edited by Maphisto's Sidekick; 12-11-2019 at 09:00 AM..
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Old 12-11-2019, 01:28 PM
wilsonchan18 wilsonchan18 is offline
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Quote:
Originally Posted by Maphisto's Sidekick View Post
In the US, some large account contracts include an aggregate retention/deductible limit - an upper bound on the retention/deductible the insured is required to pay.

When I priced such contracts, there was an explicit calculation of the frequency of the occurrence of that condition and the conditional marginal severity (especially expenses) for such.

EDIT: I just realized this is in an exam forum (I was skimming new posts). My answer was a real-world answer, and as such may differ from the course material.
Thanks for the reply. So it is something like big deductible to trigger.
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