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Self-Insured Retention (SIR)

October 9, 2012

SIR is the dollar amount specified in an insurance policy (usually a Liability policy) that the insured must pay directly to the claimant before the insurance company (the insurer) will pay on a claim.  This is very different than a Deductible, which the insured pays to the insurance company.  According to International Risk Management Institute, Inc. (IRMI) there are two important distinctions between the definition of SIRs and Deductibles:

SIR – A liability policy’s limit stacks on top of an SIR.

Deductible – The amount of a liability insurance deductible is subtracted from the policy’s limit.

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