Difference in Conditions / Difference in Limits (DIC/DIL)

Concept

Difference in Conditions/Difference in Limits (DIC/DIL) cover is a supplementary coverage within an international insurance program that closes coverage gaps between a global master policy and the often less comprehensive local policies taken out to meet local market requirements.

Mechanism

If a local policy provides a narrower scope of coverage (difference in conditions) or a lower sum insured (difference in limits) than the global master policy, the DIC/DIL cover steps in and ensures that the policyholder overall receives the scope of coverage promised under the master program.

Relevance for Multinational Insurance Programs

DIC/DIL cover is a key design element of multinational insurance programs, since the location of risk principle forces the placement of local policies in many countries whose terms may, for regulatory or market reasons, diverge from the terms of the global master policy.