The DICE method is used in pre-loss policy analysis to determine the extent of coverage.

The DICE method is used in pre-loss policy analysis to determine the extent of coverage.

• A. Assess the declarations for scope of coverage.
• B. Determine the extent of coverage.
• C. Focus on past losses only.
• D. Identify premium cost.

Answer: (B)

The main idea is to determine exactly what the policy would pay for in a loss, i.e., the extent of coverage, before a loss happens. The DICE method guides you through evaluating the insuring agreement, what property and perils are covered, the limits and any endorsements or exclusions, and the policy conditions. This helps you see, for a potential scenario, how much of the loss is covered, what limits apply, and where gaps might be. It’s not primarily about analyzing declarations alone, focusing only on past losses, or figuring out premium cost, which are separate aspects of policy analysis.

The main idea is to determine exactly what the policy would pay for in a loss, i.e., the extent of coverage, before a loss happens. The DICE method guides you through evaluating the insuring agreement, what property and perils are covered, the limits and any endorsements or exclusions, and the policy conditions. This helps you see, for a potential scenario, how much of the loss is covered, what limits apply, and where gaps might be. It’s not primarily about analyzing declarations alone, focusing only on past losses, or figuring out premium cost, which are separate aspects of policy analysis.