Search
 
Analysis

Managing Your Risk: Self-Insured Retentions vs. High Deductibles

Insurance limits attach above the primary layer of risk imposed on the insured in both self-insured retentions and deductibles, but these types of coverages are different.

By Glenn F. Fencl | Updated on February 01, 2014
In the current economic climate, first-dollar coverage has become a luxury that many commercial insureds can no longer afford. In the current economic climate, first-dollar coverage has become a luxury that many commercial insureds can no longer afford. (Shutterstock)

Although policies with large self-insured retentions (SIRs) and deductibles have always been available, they were frequently overlooked in the past when bottom lines were healthier and insurance-premium costs were subject to less scrutiny. As more insureds assume greater responsibility for managing the risk of smaller claims while relying on traditional insurance products for catastrophic protection, more policies are being issued with significant SIRs and deductibles.

While insurance limits attach above the primary layer of risk imposed on the insured in both self-insured retentions and deductibles, these types of coverages are otherwise very different. That’s why it’s important that clients understand the differences between SIRs and deductibles and the various issues that can arise both for the insured and the insurer.

Want to continue reading?
Become a Free
PropertyCasualty360 Digital Reader.

INCLUDED IN A DIGITAL MEMBERSHIP:

  • All PropertyCasualty360.com news coverage, best practices, and in-depth analysis.
  • Educational webcasts, resources from industry leaders, and informative newsletters.
  • Other award-winning websites including BenefitsPRO.com and ThinkAdvisor.com.

Already have an account?

NOT FOR REPRINT

© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Recommended Stories

PropertyCasualty360

Join PropertyCasualty360

Don’t miss crucial news and insights you need to make informed decisions for your P&C insurance business. Join PropertyCasualty360.com now!

  • Unlimited access to PropertyCasualty360.com - your roadmap to thriving in a disrupted environment
  • Access to other award-winning ALM websites including BenefitsPRO.com, ThinkAdvisor.com and Law.com
  • Exclusive discounts on PropertyCasualty360, National Underwriter, Claims and ALM events

Already have an account? Sign In Now
Join PropertyCasualty360

Copyright © 2025 ALM Global, LLC. All Rights Reserved.