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📋 '''Per occurrence deductible''' is the portion of a covered loss that the [[Definition:Policyholder | policyholder]] must absorb each time a distinct [[Definition:Occurrence definition | occurrence]] triggers the [[Definition:Insurance policy | insurance policy]]. It resets with every qualifying event, meaning the insured bears the deductible amount anew for each occurrence rather than satisfying a single threshold for the entire policy period. This structure is standard across [[Definition:Property insurance | commercial property]], [[Definition:General liability insurance | general liability]], and many [[Definition:Casualty insurance | casualty]] lines, and it appears prominently in [[Definition:Reinsurance | reinsurance]] contracts — particularly [[Definition:Per occurrence excess of loss | per occurrence excess of loss]] programs — where the [[Definition:Ceding company | cedent's]] [[Definition:Retention | retention]] functions as a deductible on each event.

⚙️ Each time an insured event occurs, the policyholder pays losses up to the deductible amount before the insurer's obligation begins. If a commercial property policy carries a $100,000 per occurrence deductible and the insured suffers two separate fire incidents during the policy year, the insured absorbs $100,000 on each fire independently. This contrasts with an [[Definition:Aggregate deductible | aggregate deductible]], which accumulates all losses until a single cumulative threshold is met. The [[Definition:Occurrence definition | definition of occurrence]] in the policy governs how losses are grouped — a critical determination when multiple losses arise from related circumstances, such as a windstorm damaging several insured locations. In jurisdictions like the United States, standard [[Definition:Insurance Services Office (ISO) | ISO]] policy forms define occurrence broadly, while bespoke manuscript forms in the London market or specialty lines may adopt narrower or tailored definitions.

💡 Per occurrence deductibles serve as a risk-sharing mechanism that aligns the insured's incentives with prudent [[Definition:Loss control | loss prevention]] and claims management, since the insured bears meaningful first-dollar cost on every event. For insurers, the deductible eliminates small, frequent claims — often called [[Definition:Attritional loss | attritional losses]] — from their portfolio, reducing administrative expense and allowing them to focus [[Definition:Underwriting | underwriting]] capacity on more severe exposures. The size of the per occurrence deductible is a key negotiating point between [[Definition:Insurance broker | brokers]] and [[Definition:Underwriter | underwriters]], directly influencing [[Definition:Premium | premium]] pricing: higher deductibles translate into lower premiums, all else being equal. [[Definition:Risk manager | Risk managers]] at large corporates frequently select elevated deductibles as a deliberate [[Definition:Risk retention | risk retention]] strategy, retaining predictable frequency losses internally while transferring catastrophic severity to the insurance market.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Occurrence definition]]
* [[Definition:Aggregate deductible]]
* [[Definition:Retention]]
* [[Definition:Self-insured retention (SIR)]]
* [[Definition:Per occurrence excess of loss]]
* [[Definition:Deductible]]
{{Div col end}}

Definition:Per occurrence deductible - Revision history

PlumBot: Bot: Creating new article from JSON