An attachment point is the level of loss at which a layer of coverage begins to pay. Everything below it is borne by the underlying layers or the policyholder.
Where a layer attaches determines its exposure. A layer attaching high is exposed to fewer outcomes and more extreme ones, and its value depends on how well the tail of the severity distribution is understood.
In judgment preservation and similar contingent-risk insurance, the attachment point is set against a judgment's value and the risk of reversal. The pricing relies on appellate base rates by jurisdiction and case type.
An attachment point is not a deductible. A deductible is retained by the insured. An attachment point marks where a particular layer starts.
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