Wind & deductible glossary.

Coverage that reduces the high percentage wind, hurricane, or named-storm deductible on a commercial property policy to a lower retained level, cutting the owner's out-of-pocket cost after a covered storm loss.

The same coverage described as buying 'back' the portion of the deductible above the level the owner wishes to retain; used interchangeably with buy-down across the market.

Another term for coverage that reduces or reimburses a policy's deductible; used interchangeably with buy-down in many markets.

A special percentage deductible that applies when a loss is caused by a storm formally named by the National Hurricane Center, including tropical storms and hurricanes.

A special deductible applying specifically to hurricane-category events, often tied to a hurricane warning or a Category 1 or greater designation for the area.

A deductible, often combined with hail, applying to wind losses outside named-storm or hurricane definitions, such as thunderstorms and straight-line wind.

A combined deductible covering both wind and hail perils, common in regions exposed to severe convective storms.

A deductible expressed as a percentage of insured value rather than a flat dollar amount, so the dollar retention scales with the size of the property.

A deductible expressed as a fixed dollar amount regardless of insured value, in contrast to a percentage deductible.

The lowest deductible level a buy-down will reduce to; the owner still retains this amount. Buy-downs are generally not designed to reduce the deductible to zero.

A broad, flexible policy that fills gaps left by a primary property program, sometimes including catastrophe perils and deductible exposure.

Coverage that pays a predetermined amount when a storm meets defined triggers, such as wind speed or hurricane category, regardless of the actual loss sustained.

The insurer's exposure on a buy-down: the limit between the overlying carrier's deductible and the lower deductible the insured buys down to. It is the amount of deductible being transferred.

The rate charged on the line of coverage, calculated by dividing the premium by the line. It differs from the rate applied to property values and is the key pricing metric for a buy-down.

The retention the insured chooses to keep. The buy-down responds above the attachment point up to the overlying deductible, so a lower attachment means more exposure transferred.

The lowest retention a buy-down program will write to; the insured always keeps at least this amount. It is why a buy-down is not designed to reduce the deductible to zero.

The primary property insurer whose policy the buy-down pairs with and buys down. The overlying carrier's deductible sets how much exposure the buy-down must pick up.

A policy written to mirror the terms, conditions, and definitions of the overlying property policy, so the buy-down responds consistently with the primary coverage it supports.

A basis on which a buy-down links to the overlying form to provide seamless coverage, responding to the covered wind peril as the primary policy defines it.

The number of years of premium it would take to equal the line of exposure. Asset managers and portfolio owners use it to weigh buy-down cost against retained risk per property.

A deductible applied separately to each covered event, so multiple storms in a season can each trigger a retention the buy-down can address.

A deductible applied to each insured location rather than the whole schedule, relevant to how a buy-down is structured across a multi-property account.

A deductible applied to each building, a granular structure that affects the true retained exposure on a portfolio and how a buy-down is written.

A floor set by the overlying carrier that can supersede the percentage on the declarations page, dictating the true per-location or per-building deductible on a multi-location account.

A cap on total buy-down payout for the policy year; once exhausted, the policy stops responding. May be stated as a dollar amount or as a multiple such as 2x or 3x the line.

The conventional property rate applied to insured values, distinct from rate on line; the two are not interchangeable when evaluating a buy-down.

The defined condition that causes a special deductible or a parametric payout to apply, such as a storm being named or reaching a wind-speed threshold.

The U.S. agency that names tropical systems and issues watches and warnings; its naming and designations often serve as deductible triggers.

The 1-to-5 hurricane category scale based on sustained wind speed, sometimes referenced in hurricane deductible trigger definitions.

A named tropical system with sustained winds below hurricane strength; can trigger a named-storm deductible even though it is not a hurricane.

Damaging wind not associated with rotation, produced by thunderstorm downdrafts, typically falling under an all-other-wind deductible.

A widespread, long-lived windstorm associated with fast-moving thunderstorms, generally treated as an all-other-wind event.

A general term for wind-caused loss events, the peril category that wind and named-storm deductibles address.

The point at which a storm's center moves over land; relevant to how and when storm-related deductibles are applied.

The full insured value of a property, including building, contents, and often business income; the base to which a percentage deductible is applied.

The value on which coverage and deductibles are calculated, whether replacement cost or actual cash value depending on the policy.

The cost to rebuild or replace damaged property with materials of like kind and quality, without deduction for depreciation.

Replacement cost minus depreciation; a valuation basis that reduces the amount paid on older property.

A policy provision requiring the insured to carry coverage equal to a set percentage of value, or share in a loss if underinsured.

A limit within a policy that caps recovery for a specific peril or category below the overall policy limit.

An event, or continuous exposure to conditions, that results in covered loss; deductibles typically apply per occurrence.

A deductible that applies separately to each covered event, so multiple storms in a season can each trigger a retention.

A cap on the total deductible an insured pays across multiple events in a policy period, where the policy provides one.

Coverage for lost income and continuing expenses when a covered event halts operations; often part of TIV.

The portion of risk an insured keeps rather than transfers to an insurer; a deductible is a form of retention.

Shifting potential loss from one party to another through insurance or contract, the core function of a buy-down.

Deliberately retaining a risk and funding losses internally through reserves, credit, or a captive, rather than buying coverage.

An insurance company owned by the businesses it insures, sometimes used by large owners to formally self-insure retentions.

The risk, in parametric coverage, that the payout does not match the actual loss because it is tied to a parameter rather than damage.

The total cost of managing risk, including premiums, retained losses, and administrative expense; a buy-down converts variable retained loss into fixed premium.

The ongoing cost of holding an exposure or asset; used here to describe turning a variable deductible into a predictable expense.

A condition in a financing agreement, which may cap acceptable deductible levels and thereby require deductible relief such as a buy-down.

Coverage a lender buys on a property when the borrower's insurance is deemed insufficient, often costly and limited.

The highest-hazard coastal band, typically nearest the shoreline, where wind deductibles and pricing are most severe and buy-down demand is greatest.

A secondary coastal band inland of Tier 1, still wind-exposed but generally with somewhat lower deductibles and pricing than Tier 1.

Property coverage for a structure under construction; buy-downs can often be written on builder's risk to address wind deductibles during the build.

The risk of large, correlated losses from events like hurricanes; the reason insurers apply high percentage wind deductibles.

A state-associated insurer of last resort providing wind coverage in high-risk coastal zones where the standard market is limited.

Insurance placed with a non-admitted carrier for risks the admitted market may not write; wind buy-downs are frequently placed this way.

An insurer licensed by a state and subject to its rate and form regulation, whose policyholders are generally protected by the state guaranty fund.

An insurer not licensed in a given state but permitted to write certain risks through surplus-lines channels, offering flexibility for hard-to-place exposures.

A state fund that pays certain claims if an admitted insurer becomes insolvent; surplus-lines carriers generally do not participate.

Construction features and upgrades, such as roof strapping or impact glazing, that reduce wind vulnerability and can affect pricing.

A designated area where building codes require protection against debris driven by high winds, relevant to coastal construction.

The process by which an insurer evaluates a property to decide whether to offer coverage and on what terms, price, and conditions.

The range of risks an insurer is willing to write; coverages subject to appetite depend on the property meeting underwriting criteria.