What is another name for the self-insured retention in a Personal Umbrella Policy (PUP)?

In the context of a Personal Umbrella Policy (PUP), the self-insured retention refers to a specific amount that the policyholder must pay out-of-pocket before the umbrella policy comes into effect. This retention is similar to a deductible in that it represents the portion of a claim that the insured is responsible for, ensuring they share in the risk before the additional coverage kicks in.

When an individual holds a PUP, it acts as excess liability coverage above and beyond what the primary insurance (like homeowners or auto insurance) provides. However, before the PUP starts providing coverage, the insured must meet this retention threshold. This mechanism encourages responsible behavior by incentivizing policyholders to manage their risk, since they are directly financially responsible for claims up to that specified retention amount.

In contrast, the other choices do not align with this definition. A "coverage limit" refers to the maximum amount the policy will pay for a covered loss, while "excess liability" denotes the nature of the umbrella policy itself as coverage that kicks in after primary limits are exhausted. "Primary coverage" is simply the core insurance that provides first-instance coverage and does not encompass the responsibility of the insured for the self-insured retention amount. Thus, identifying the self-insured retention