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Not sure what you're asking here? Are you asking about absorbing the deductible? Is $1,460.00 the full deductible (because I'm not sure I have ever seen a deductible in that amount unless it is a percentage deductible)? In my experience the term "excess" is applied to the relationship between two policies covering the same loss and how they interact with each other.

If what you are asking is how the amount over the special limits affects the deductible, then my answer is this:

1. Check the policy and make sure that it requires taking the deductible off the loss (very common) instead of off the limits (very rare).
2. Take the deductible off the items with special limits first.
3. In this case I would consider that the $1,120.00 that the jewelry is over limits absorbs $1,120.00 of the deductible. This leaves an effective deductible of $340.00. I would then take that deductible amount from the $550.00 that the cash exceeds the special limit.
4. Basically, then, the entire deductible is absorbed and is effectively zero. So simply apply the special limits and do not subtract the deductible.
5. I know of no formula to calculate this, certainly not a SIMPLE formula. I guess the simplest way would be to add the amount that the special limits items exceed the special limits and subtract the deductible. If the result is zero or more, the entire deductible is absorbed.

Steve, Is the special limits amount if exceeded eligible to be taken as excess and be used against the deductible?

Deductibles are taken off the loss and not off the coverage.

Loss less deductible then coverage.

This is really picky, but when discussing property claims with adjusters, agents, attorneys and insureds you have to use the correct words. "in Texas most deductibles are 1% by default. Not correct,its the amount the insured selected. When an insured tells me their house was flooded and I know its a Homeowners policy, I have to settle my heart back down, until she says the water came through the roof. Its not professional to use not accurate words.

In commercial losses you may see a loss that does not have a deductible for some perils or you may see a deductible that is not a first dollar, but will not apply if the loss is over a stated amount or %, or has a time frame.

What steve says is correct. Normally the deductible is subtracted from the dwelling but the policy usually doesn't require that. The deductible can (and sometimes should) be subtracted from other lines of coverage.

Don't feel like you are stuck using some standard SOL spreadsheet. If you need to subtract the deductible for 3 different places, go for it. Type your SOL by hand if you have to.
------------------------------------------------------------------------
SOL

Item :Building

replacement cost of repairs as per adjuster's
Xactimate estimate 700.00
less depreciation 100.00
building repairs at actual cash value 600.00

Item: Unscheduled Personal Property

total loss items per insured's inventory 600.00
less depreciation 130.00
personal property actual cash value 470.00


Item: cash

total loss cash as per insured's sworn statement 750.00
less a portion of deductible 550.00*
net cash subtotal 200.00
paid at policy sublimit 200.00

Item: jewelry

total loss jewelry as per Acme Accurate Insurance
Appraisals Inc. 2500.00
less depreciation as per Acme 380.00
jewelry loss at actual cash value 2120.00
less remaining portion of deductible * 910.00
($1460 less 550 = 910)
net jewelry loss subtotal 1210.00
paid at policy limit subtotal 1000.00

total net claim 2270.00

* we have applied a portion of the $1460 deductible to the Cash loss and another portion to the Jewelry loss. Applying the deductible in this manner yields a higher settlement to the insured as the deductible is "absorbed" in the portion of the loss which exceeds the policy sublimit.

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the explanatory note is not my best writing, that is optional to include. I included just to show that it can be done; you can put asterisks and footnotes on statements of loss if you think it is helpful.

another caveat, i didn't check my math etc, i just did this quick to show you ONE way you could do the SOL.

I put:

paid at policy limit subtotal 1000.00


but usually i would put:

paid at policy limit subtotal (deductible absorbed) 1000.00

or:

paid at policy limit subtotal; deductible absorbed 1000.00

but in this case you could put:

paid at policy limit subtotal (portion of deductible absorbed) 1000.00

or even:

paid at policy limit subtotal 1000.00
(portion of deductible absorbed; see explanatory note below)


just ask somebody in your company that has grey hair and do it whatever way they like it done.

If you use MSB Integra, and I also use Xactimate and think it will do same thing, you put in your coverage and any limits then put loss amounts on the coverage specific and deductible taken across all coverages. The SOL will give the proper settlement after applying the deductible to the loss. Then proper payment is calculated on the SOL. Just put a note in captioed report or narrative about deductible being absorbed. As Chuck stated and I learned long ago, the deductible applies to the loss not the limit. There was an instance on tree removal though where a company would not allow the deductible to be eaten up on the cost of debris removal. Just have to check the policy but most are Deductible applies to loss, not the limit.