If an Umbrella Policy serves as primary coverage, which part allows the insurer to apply a deductible?

• A. The Stand Alone Form
• B. The Follow Form
• C. The Self-insured Retention
• D. None of these answers are correct

Answer: (C)

A deductible-like amount in umbrella policies is called the self-insured retention. When the umbrella policy serves as the primary coverage, the insurer applies this self-insured retention, meaning the insured must pay that amount out of pocket before the umbrella coverage kicks in. The SIR functions as the umbrella’s deductible, shifting initial risk to the insured and then allowing the umbrella to pay excess amounts up to its limits once the SIR is satisfied.

The other forms describe how the umbrella relates to underlying coverage. A stand-alone form is a separate umbrella policy that stands on its own, potentially with its own terms and deductibles rather than a built‑in SIR. Follow form means the umbrella mirrors the terms of underlying policies and doesn’t establish a distinct deductible in the umbrella layer itself.